Student Loan Discharges & Bankruptcy
Let Out Attorneys Help You Discharge Student Loans
If you’re dealing with student debt, you have probably heard that student loans are difficult, if not impossible, to discharge in bankruptcy. While it is difficult to discharge student loans in bankruptcy, it is certainly not impossible. However, if you wish to discharge student debt in bankruptcy, you need to seek the counsel of an experienced, knowledgeable legal team with experience handling cases like yours. At LSS, our attorneys can help with your bankruptcy case and help you tackle outstanding student loans.
Creating a Plan for Your Unique Situation in Miami, Fl
In order to discharge a student loan in bankruptcy, the borrower must show that the payment of the student loan – whether a federal or private student loan – will result in an undue hardship on the borrower and the borrower’s dependents. Courts around the country use different tests to evaluate whether a particular borrower has shown an “undue hardship.”
The most common test to determine whether or not a debt will create a hardship is the “Brunner Test”, which requires a showing that:
- (he borrower cannot maintain, based on current income and expenses, a “minimal” standard of living for the borrower and the borrower’s dependents if forced to repay the student loans;
- Additional circumstances exist indicating that this state of affairs is likely to persist for a significant portion of the repayment period of the student loans; and
- The borrower has made good faith efforts to repay the loans.
This test is based on a 1987 Circuit Court decision and is commonly used by United States Bankruptcy Courts in Florida.
However, much has changed since 1987, and some courts have begun to question whether a more relaxed and realistic standard should be used. If an undue hardship can be proven, your student loans can be discharged.
How Can Bankruptcy Help With Student Debt?
Even without a discharge, bankruptcy can help many student loan borrowers. The bankruptcy automatic stay, which can last anywhere from a few months to five years, depending on the type of bankruptcy filed, can be a huge benefit for borrowers who are drowning in student loan debt. It is very important to seek advice from a bankruptcy and student loan attorney who understands the various tests employed by the courts, and who can best advise you regarding your options.
Our attorneys at LSS Law can help, however complex your bankruptcy case may seem.
Call us today for an in depth strategy session to discuss plans for your student loans in bankruptcy.
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