Discharging Student Loans

If you are looking to discharge your student loans, it is a complex process,
but not impossible.After 1990, student loans are no longer considered
“dischargeable.” This means that in order to seek relief, an adversary
proceeding is required--a lawsuit must be filed separate from the bankruptcy
case. You must prove that the payment on your student loans causes an undue

hardship. Most courts use the Brunner test to measure the burden of the debt.
It is a three-pronged evaluation that requires the following: 1) the individual
and their dependents cannot maintain a minimal standard of living if they
were required to pay the student loan,2) there must be additional factors that
guarantee this poor standard of living will continue throughout the whole
payment period, and 3) the individual has made good faith effort to pay the
loans. If you can demonstrate that you meet these conditions, your student loan

could be cancelled as a whole.

There are advantages and disadvantages to discharging student loans. To better
understand if filing for an adversary proceeding is for you, it is recommended
that you set up a consultation with your local bankruptcy attorney.