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Can you discharge student loans in bankruptcy?

June 1, 2016

Can you discharge student loan in bankruptcy? Usually no. To discharge student loans you would need to bring forth an adversary proceeding in your case, and be able to meet all the elements of the Brunner Test. The Brunner Test requires you to prove undue harship and meet other elements. Undue hardship is difficult to prove. You woul have to be unable to make income, basically, be too disabled or unable to make income. There is a growing problem with student loans in this country, and Congress is well aware of this problem. There might be legislation being drafted to address student loans in bankruptcy, but in the meantime, student loans are almost never discharged in bankruptcy.

 

This may not be what you want to hear or read. You may want to hear that it is very simple (by bankruptcy attorney standards at least) to discharge student loans, or that it is very common. Unfortunately, that is simply not the law currently. There is some relief available at least, even if you do not discharge them, you can at the very least prevent them from collecting during the pendency of your case. It can be as long a 5 years in a chapter 13. Keep in mind, interest does accrue during this time.

 

There is an option known as Income Based Repayment that should be looke into if your monthly payments are too high for you to manage based on your income.

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