Many people must borrow money to fund their higher education, but it often becomes a struggle to pay it back. As a result, numerous borrowers consider the possibility of obtaining debt relief through bankruptcy. However, student loans typically aren’t dischargeable. Even if an individual successfully eliminates the majority of their debt after filing bankruptcy, they will still be responsible for their student loan obligations unless they receive a special discharge. Here’s some information you will need if you wish to go this route.

Proving Undue Hardship 

Before you can qualify to have your student loans discharged, you must be able to show that paying back your debt would cause undue hardship. Generally, the court will use the Brunner test to determine if you’re eligible to have your student loans dismissed. This requires proving:

• You wouldn’t have the means to maintain a minimum standard of living if you continue paying back your loans.
• Your hardship isn’t likely to change.
• You made a good-faith effort to repay your debt.

Filing for Student Loan Bankruptcy

Consult a Bankruptcy Attorney

Filing for bankruptcy is a complex process. You aren’t required to hire an attorney, but it’s strongly recommended that you have professional guidance. They will assess your financial situation and identify your eligibility for student loan dismissal, as well as help complete all of the necessary paperwork and present your case in court.

Choose Which Chapter to File

To file a Chapter 7 bankruptcy, you must pass a means test that shows you don’t make enough income to pay off your debts. This filing would allow your student loans to be completely wiped out. A Chapter 13 bankruptcy will reorganize your debt into an affordable repayment plan that lasts three to five years. After this time, the balance of your loans may be forgiven. 

File an Adversary Proceeding

Requesting a student loan discharge requires taking an extra step in the bankruptcy process. An adversary proceeding must be filed with the court. This should include an outline explaining how you meet the criteria for undue hardship. After this is submitted, your case will start litigation. 

If you have exhausted all of the other options for managing your student loan debt and wish to declare bankruptcy, contact O’Connor, Mikita & Davidson. They can help gather the evidence you need to establish undue hardship and provide valuable guidance through the filing process. For more than 20 years, they have been working with Cincinnati, OH, residents to retake control of their finances and achieve a debt-free life. Call (513) 793-5297 to schedule a consultation, or visit them online to learn more about the different types of bankruptcy available.