Can student/education loans be discharged?
No, with one exception. Education loans and benefit overpayments made, insured or guaranteed by the government are not generally discharged in Chapter 7 or Chapter 13. Educational loans may be discharged only if the court finds that the loan “will impose an undue hardship on the debtor and the debtor’s dependents.” [523(a)(8)(B)] You must be able to demonstrate that you cannot make payments the loan at the time the case is filed or in the future. You must apply for the hardship discharge while your case is still open (before the discharge is granted). In Chapter 7 this is usually about 6 months from the date the case is filed. In Chapter 13 the case will be open until after the last plan payment is made (3 to 5 years). Application for a hardship discharge is not included in the Chapter 7 or Chapter 13 fees and must be requested and paid for after the case has been filed.
