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Getting Student Loans Discharged in Bankruptcy

You may have heard that student loans cannot be forgiven after filing for bankruptcy. Typically, student loan debt cannot usually be wiped, whether you file for either Chapter 7 or Chapter 13 bankruptcy. However, there are ways to work around this so that your loans can qualify to get wiped in your bankruptcy, and that is by demonstrating “undue hardship.”

Life after leaving college is an immense financial struggle for many. If this is your situation, you may have thought about ways to relieve your debt, even if it means skipping out on payments. This is never a good idea. It hurts your credit—much worse than bankruptcy would. So what do you need to prove that your situation is an “undue hardship?”

Passing Undue Hardship Tests

Bankruptcy is a major decision. You may have already sought legal counsel and made the determination that it is right for your personal as well as financial circumstances. The next step is to have the courts grant relief for your student loan debts by passing the undue hardship test. You would need to prove that because of your hardship, it would not be possible to continue making payments.

One of the most common tests that courts use is called the Brunner standard, which allows student loans to be forgiven if the person’s situation meets all of the requirements.

  1. Poverty—You are having trouble sustaining a livelihood for your family due to your income.
  2. Persistence—Your financial situation will likely continue throughout the repayment period.
  3. Good faith—You have made diligent efforts to repay the loans.

There are several other types of tests that court use, so it is vital that you speak with a Charlotte bankruptcy attorney about the test your local, courts use. Having the information ready ahead of time can increase your chances of successfully getting your student loan debt wiped.

Get Started Today—Contact Us!

At Saffa Law Firm, we are passionate attorneys who are committed to helping our clients overcome their burdens by providing them with sound legal counsel. We understand that being saddled with debt can weigh heavily on you. It is our hope that we can take that relieve some of that pressure for you and help you find the peace you need to move forward.

Call us at (704) 710-8182 to schedule a free case consultation!