Student loan debt can be dischargeable in bankruptcy; however, having your student loan discharged can be difficult to achieve on your own. It was previously thought that student loans were not dischargeable, but Federal Student Aid (FSA) notes that you can file a separate action to have your student loans discharged via bankruptcy.
You can opt to hire a bankruptcy lawyer from our firm to help you prepare your case and present it to the bankruptcy courts. Our law firm offers free case evaluations. A consultation with a member of our team can help you understand how filing for bankruptcy may be able to relieve you of your student loans.
You Need to Prove “undue Hardship” to Have Your Student Loans Discharged
To get your student loans discharged, you will have to prove that being forced to repay your student loans is bringing “undue hardship” to you and your dependents. You could also argue that it would cause such hardship in the near future.
If successful, you can have most or all of your student debt eliminated. Individuals can file for Chapter 7 or Chapter 13 bankruptcy, depending on the circumstances they face. Our law firm can guide you through either of these processes.
The Bankruptcy Courts Will Judge You in an Adversary Proceeding
The FSA notes that when filing for bankruptcy, you can file a separate action called an adversary proceeding. During this proceeding, the bankruptcy courts will review your student loan debt. Using the information they find, the courts will determine whether you have or will have undue hardship and, thus, cannot repay back your debt.
Before making their decision, the courts may use the Brunner test to measure whether you have established undue hardship in your life. This test identifies whether:
- You can or cannot maintain a “minimal standard of living” with your current income if you are forced to pay for your student loans.
- Other circumstances exist that will keep you in your current financial state for an extended period as you repay your student loans.
- You have made a good effort to repay your student loans.
A bankruptcy lawyer from our team can help you construct your complaint and present it to the courts. Based on your statements and their findings, they will evaluate whether your student loans might be discharged in bankruptcy.
Potential Outcomes from the Adversary Proceeding
Depending on your income and other factors, you may file for Chapter 7 or Chapter 13 bankruptcy. This affects how your student loans will be handled. After the adversary proceeding, you can expect one of the following outcomes:
- Your student loans get fully discharged, along with other debts you may have (a potential result if you file under Chapter 7).
- Your student loans get partially discharged, but you also receive a court-approved repayment plan that reasonably accommodates your income (a potential result if you file under Chapter 13).
- Your student loans do not get discharged, so you must repay them yourself. However, you may be able to negotiate a lower interest rate.
Our Bankruptcy Lawyers Can Help You Fight to Have Your Student Loans Discharged
For many, it might be an understatement to say how complex the bankruptcy process is, especially with the amount of paperwork required. Should you decide to work with our law firm, we can handle these legal administrative tasks for you.
We’ll Handle the Paperwork
We can review which forms (as provided by the US Courts) are required of your case, particularly in regard to student loan debt. Paperwork may involve:
- Filing a bankruptcy petition
- Drafting an official complaint about your student loans
- Filing an action for an adversary proceeding
- Filing multiple schedules related to other debts you have
A bankruptcy lawyer from our team can fill out these forms and submit them on your behalf, relieving you of further financial stress you may be experiencing.
We Can Present Your Case for You
Our team can also appear in meetings and court hearings on your behalf to present your bankruptcy case. We will keep you updated as your case progresses and advise you when necessary.
Fighting to have your student loan debt discharged in bankruptcy can be extremely hard, but it is possible for some. Our bankruptcy lawyer can provide legal guidance. We will help you prepare your case for the bankruptcy courts to review it.
Have a Bankruptcy Lawyer from Farmer & Morris, PLLC, Help You with Your Case
You can get more information in a free consultation with one of our team members. Just call (828) 286-3866, and one of our representatives will speak with you about your case. They can also determine whether your student loan debt may be discharged in bankruptcy and explain how one of our lawyers can help you.