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Discharging of Student Loans – Brunner Test: Undue Hardship

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October 30, 2016

Successfully getting student loans discharged in a Chapter 7 bankruptcy case is very difficult. For the most part, you must show that repayment would cause you “undue hardship.”   Most courts us a 3-factor test, called the Brunner test, to determine if you can meet the undue hardship requirement for student loan discharge.

What is the Brunner Test?

There are 3 factors or prongs that must be met:

1.    Poverty:

Based upon your current income and expenses, you cannot maintain a minimal standard of living for yourself and your dependents if you are forced to repay your loans.

2.   Persistence

Your current financial situation is likely to continue for a significant part of the repayment period.

3.   Good faith

You have made a good faith effort to repay your student loans.

Although most courts will look to determine if you meet the 3 prongs of the Brunner Test, Courts will also look at the Totality of the Circumstances Test.   In this case, the Courts will look at all relevant factors in reaching their decision to discharge your student loans.

When coming to the U.S. Bankruptcy Court to discharge your student loans, you should seek the counsel of a Certified Bankruptcy Lawyer.   Your attorney will know the circumstances fully and present them to meet the Court’s standards for reasonableness.