Tag Archives: College

Why is it Difficult to Discharge Student Loans in Bankruptcy?

Student loan debt in the US has grown to an astonishing $1.4 trillion dollars. While some people have an easy time making monthly payments on their student loans, others struggle or have defaulted. It is commonly believed it is impossible to file for bankruptcy on student loans. However, it is not impossible, just very difficult in many cases. You must prove repaying your loans would cause undue hardship. What is Undue Hardship? Bankruptcy courts may use one of several tests to determine whether a debtor meets the undue hardship requirement. The test used by the court could depend on where you file your case. Most courts are still using the Brunner test. Under this test, the courts would look at: Whether you could maintain a minimal standard of living for yourself of your dependents if you were forced to repay the loans. Whether the financial situation keeping you from maintaining…
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