Can Student Loans be Discharged in Chapter 7 Bankruptcy?

When it comes to bankruptcy, some debts will be forgiven and others will not. As a result, you may have a lot of questions. Some of the most common questions involve student loans. Read on to learn more about whether you can discharge student loan debt under chapter 7 bankruptcy in New York.

What to Know About Undue Hardship?

Undue hardship essentially means that you are faced with loans you simply cannot pay off or would be paying off for your entire life. For example, if face an astronomical amount of student debt, but your job only pays you “x” amount of money, it may be nearly impossible to balance paying your debt and making necessary purchases, such as food, water, clothing, or basic shelter. This is an extremely difficult situation for a hard-working person to be in. As a result, proving undue hardship may grant you the relief you need. In order to prove undue hardship, many courts use the Brunner test, named after the Brunner v. New York Higher Education Services Corp. case. As a result, in some cases, if you can prove that you can no longer maintain a minimal standard of living for you and your family, your current financial situation is set to continue for years to come, and you are doing your absolute best to pay your student loans and keep afloat, you may have your student debt wiped out under the Brunner test.

What Does the Process Entail?

To discharge your student loans, you will have to file an adversary proceeding. Here, the bankruptcy court will determine whether your loans are dischargeable. Additionally, you must provide the court with evidence that your loans will cause you undue hardship. This can be difficult to prove, so you should reach out to an experienced bankruptcy attorney to help with the process.

If you have any questions or concerns regarding chapter 7 bankruptcy and discharging student loans, reach out to our experienced firm.


Michael D. Pinsky, P.C. represents clients in bankruptcy actions and related matters. Please call 845-394-2616 or contact the firm online to schedule a consultation.

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