Discharging student loans in bankruptcy is difficult, but not impossible. In order to discharge student loans in a bankruptcy case, the debtor must demonstrate that repaying the loans would cause an undue hardship. This standard is difficult to meet, as the courts have interpreted it to require a showing of significant and long-lasting financial difficulties.
To discharge student loans, the debtor must file an adversary proceeding in the bankruptcy case, which is a separate lawsuit that addresses the dischargeability of the student loans. During the adversary proceeding, the debtor must prove that the loans cause an undue hardship, which is determined on a case-by-case basis, taking into account factors such as the debtor’s income, expenses, assets, and future earning potential.
It is important to note that not all student loans can be discharged in bankruptcy. Only federal and private student loans can be discharged, while some types of loans, such as those for tuition for a for-profit school, may be dischargeable under certain circumstances.
It is recommended to consult with a bankruptcy attorney to determine whether discharging student loans is a viable option and to understand the specific requirements and steps involved in the process.