While bankruptcy can be a tool for greatly lowering your student loan obligations for a five-year period, the loans themselves are not automatically discharged through bankruptcy. They can only be discharged if your attorney files an adversary proceeding in the bankruptcy on your behalf. These proceedings are expensive (Most attorneys will require a $5000 retainer before filing one) and are only very rarely successful.

In both Oregon and Washington, student loan debtor’s are subject to the Brunner test. First, the debtor must show that she cannot maintain, based on current income and expenses, a “minimal” standard of living for herself and her dependents if forced to repay the loans. Second, she must show that this state is likely to persist for a significant portion of the repayment period of the student loans. Finally, the debtor must show that she has made good faith efforts to repay the loan.

It is not enough to show one of the above elements. All three must be proven. Fortunately, there are other routes to discharge other than proving undue burden. These routes are as follows:


One way to eliminate student loans is through demonstrating a qualifying disability. The U.S. Department of Education has established a pretty rigid and complicated test for determining whether your disability meets the standards required for disability discharge. In essence, you must show that the disability is either total or permanent or that you received a disability separation from the military.

School Closure

Let’s say your education was somehow interfered because your school unexpectedly shut down, or there was an incident at the school that necessitated a shutdown. In these circumstances you will be able to obtain a discharge of the loans you took out to pay for the education you could not receive due to the shutdown. In order to obtain this discharge you cannot have transferred those credits elsewhere.

False Certification

If the institution you attended was not properly certified or accredited, you may be entitled to a discharge of the loans taken out to attend that school. These are special circumstances and you will likely need an attorney to evaluate whether you would qualify.

Those seeking discharge due to financial hardship would be best suited to trying one of the income-based repayment plans. Contact us today to talk about your options.

We Can Eliminate Debt

Even if you don’t qualify for discharge, there are many options for resolving your student loan debt. The fact is that if you are experiencing financial hardship,  you may not qualify for discharge immediately, but you may easily qualify for an income based repayment plan that will result in you not paying another dime on your student loans.