Bankruptcy FAQs

Can I discharge student loans?

Generally, student loans are not discharged in bankruptcy. Although there are possible exceptions to this general rule:

1. The student loan may be discharged if it is neither "insured or guaranteed by a governmental unit" nor "made under any program funded in whole or in part by a governmental unit or nonprofit institution."
2. The student loan may be discharged if paying the loan will "impose an undue hardship on the debtor and the debtor's dependents."

The facts of the particular case will determine dischargeability. If a student loan falls into one of the three exceptions, discharge of the loan is not automatic. The debtor should file an adversary proceeding in the bankruptcy court to obtain a court order declaring the debt discharged.

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