CAN STUDENT LOANS BE DISCHARGED THROUGH BANKRUPTCY?
You cannot discharge a student loan in Chapter 7 or Chapter 13 bankruptcy unless you prove to the court that repaying the loan would be an undue hardship.
Some courts use a three-pronged test to determine if paying the loan would be an undue hardship. If your situation meets these three criteria, your student loan debt could be discharged:
- You will be unable to maintain a minimal standard of living for yourself and your dependents if you are forced to pay your loans. This determination is based on your current income and expenses.
- Your current situation is likely to continue for a significant portion of the repayment period.
- You have made a good faith effort to repay your loans.
Other courts consider these and other factors when determining if paying your student loans represents an undue hardship.