66 East Main Street, 3rd Floor
Little Falls, NJ 07424

Student Loan Discharge in Bankruptcy

Facebook
LinkedIn

Student Loans Discharge in Bankruptcy:

Can Student Loans Be Discharged in Bankruptcy?   The answer is:   It depends.

There are 3 factors or prongs (Brunner Test) that must be met to discharge student loan in a bankruptcy:

  1. Poverty:
  2. Persistence
  3. Good Faith

Details of Pro Se Debtor’s Case:

  • Debtor sought to discharge her student loan in bankruptcy.
  • Debtor met two of the above prongs.
  • Debtor had not responded to the U.S. Department of Education
  • Required support behind her application for an administrative discharge was missing
  • Debtor’s actions are lack of good faith.

Court Ruling:

  • The Debtor could meet all 3 (three) prongs of the requirements to discharge student debt
  • However, she did not show good faith when she failed to fully respond to the U.S. Department of Education’s application for an administrative discharge.
  • U.S. Department of Education filed a summary judgment application and it was granted by the Court.
  • Debtor could not discharge student debt in bankruptcy.
  • She fails to show good faith in responding the information requested.
  • If the Debtor completed the application and provided the required documents, her student debt was allowed to be discharged.
  • Debtor’s lack of legal knowledge and representation adversely affected the Debtor.

In summary, we confirm that representing yourself in a bankruptcy issue is not prudent.   Most times, Pro Se Debtors are not knowledgeable in the complex field of bankruptcy law.

A certified bankruptcy attorney (as I am) would know the requirements and most definitely urged the Debtor to complete the application in full.

If you are looking to reduce or eliminate your debts, contact me for a free bankruptcy consultation:

Ralph A. Ferro, Jr., Esq.   (201) 446-5904

Chapter 7, Chapter 11 and Chapter 13 Help