Can Student Loans be Discharged in Chapter 7?

Students across America pay sky-high fees to attend college and receive higher education. Although our country has some of the most intellectual, innovative universities in the world, students very often find that they are unable to pay off their loans after graduation. If you are someone who owes a significant amount in student loans and is doing your absolute best to pay them off, you are most likely feeling the stress and weight of it all.

Fortunately, you may have a way out. Though you generally cannot discharge your student loans by filing for bankruptcy, in some cases, you can–as long as you can prove you are facing undue hardship. To learn more about your potential legal options going forward, please read on and reach out to our knowledgeable bankruptcy firm.

What does undue hardship mean?

Undue hardship, in this sense, essentially means that you are faced with loans you simply cannot pay off or would be paying off for your entire life. For example, if you are a teacher and face an astronomical amount of student debt, though your job only pays you “x” amount of money, it may be nearly impossible to balance paying your debt and making necessary purchases, such as food, water, clothing, or basic shelter. This is an extremely difficult situation for a hard-working, honest person to be in. However, proving undue hardship may grant you the relief you need.

How do I prove undue hardship for student loans?

Many courts use the Brunner test, named after the Brunner v. New York Higher Education Services Corp. case. Essentially, in some cases, if you can prove that you can no longer maintain a minimal standard of living for you and your family, your current financial situation is set to continue for years to come, and you are doing your absolute best to pay your student loans and keep afloat, you may have your student debt wiped out under the Brunner test.

What is the process of discharging student loan debt?

To discharge your student loan, you will file an adversary proceeding where the bankruptcy court will determine whether your loans are dischargeable. You must also provide the court with evidence that your loans will cause you undue hardship, which is why you should always hire a seasoned bankruptcy attorney who is ready to aggressively fight for your right to relief.

Contact our experienced New York firm

Bankruptcy, for many people, is a frightening endeavor. Fortunately, with the help of an experienced attorney, it does not have to be. If you require the services of an experienced Business Law or Bankruptcy attorney, contact the Law Offices of Allen A. Kolber, Esq. today to schedule a consultation and discuss your options. We will have your back every step of the way.