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New Techniques for Discharging Student Loan Debt

Law Office of Ronald V. De Caprio Feb. 24, 2017

Prior posts on this New York bankruptcy and debt relief legal blog have discussed the difficulties some individuals may face in attempting to discharge their student loans through personal bankruptcy. Under the bankruptcy code, a debtor generally must demonstrate that their student loans impose undue burdens upon them before those debts may be dischargeable; however, the bankruptcy code does not provide much guidance as to what constitutes an undue burden in these circumstances.

Many people who have filed for bankruptcy have ended the process with their student loan debts intact. Recently, though, attorneys across the nation have been attempting to change how the courts interpret certain student loans and the applicability of the code to them. Particularly, these attorneys are challenging whether the loans issued as student loans should even qualify as student loans under the bankruptcy code.

There are certain criteria that a student loan must meet in order to be a nondischargeable debt, but, in many cases, loans made by private lenders for educational purposes did not meet those codified provisions. In such cases, the lawyers have found some success in arguing that the loans should not be considered nondischargeable by the terms of the applicable code and, therefore, have been able to include those debts with the other dischargeable debts their clients have possessed during their bankruptcy proceedings.

The body of law surrounding bankruptcy is vast but open to interpretation. As demonstrated by these legal professionals, bankruptcy attorneys have the capacity to work with the law while advocating for the very dire needs of their struggling clients. Readers who wish to learn more about student loans, personal bankruptcy, and other debt relief strategies are encouraged to contact their bankruptcy lawyers.