Can I discharge a private student loan in bankruptcy?

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Can I discharge a private student loan in bankruptcy?

I received a private endowment loan from my university 14 years ago. I filed Chapter 7 bankruptcy 6 years ago (before the law changed) and neglected to list the debt. As a no asset case, I know that even non listed debtors should be included. The endowment receives no funding from the federal government, only donations. They are now referencing 523(a)(8) of the bankruptcy code and tell me that education loans are exempt from bankruptcy. Can I discharge this loan per my bankruptcy?

Asked on November 28, 2011 under Bankruptcy Law, Georgia

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

Student loans are *sometimes*--but rarely--dischargeable in bankruptcy: they can sometimes be discharged if sufficient hardship can be shown, but this is a very hard showing to make. To show "undue hardship," you must basically show that even living very frugally, working as much as you can, having no disposable income or extraneous expenses, etc., you *still* can't pay the student loan--that doing so will effectively push you under the poverty line in terms of standard of living, and you don't have any other expenses to cut.


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