The Three Prongs of Brunner
Under Brunner v. New York State Higher Education Services Corp. (1987), you must prove all three prongs: 1. Poverty: Based on current income and expenses, you cannot maintain a minimal standard of living and repay the loans. 2. Persistence: Additional circumstances exist indicating this state of affairs is likely to persist for a significant portion of the repayment period. 3. Good faith: You have made good faith efforts to repay the loans (applied for deferments, IDR plans, etc.).
The Brunner test is notoriously strict. Courts have denied discharge to borrowers with chronic illness, disability, single parents, and elderly people with limited income. However, recent DOJ guidance (2022) has softened enforcement significantly.
DOJ Policy Changes (2022-2025)
In 2022, the Department of Justice issued new guidance directing government attorneys to stop opposing student loan discharge in bankruptcy when the Brunner test is clearly met. The DOJ created a streamlined process: debtors complete an attestation form, the DOJ reviews it, and if the facts support undue hardship, the government consents to discharge rather than fighting it.
This has dramatically increased successful discharges. Before 2022, fewer than 1% of borrowers who filed adversary proceedings received discharge. Since the policy change, the success rate has increased significantly. If you have federal student loans and genuine financial hardship, the path to discharge is more realistic than ever before. Learn about bankruptcy options.
How to Pursue Student Loan Discharge
Student loan discharge requires an adversary proceeding -- a separate lawsuit filed within your bankruptcy case. This is more complex than a standard bankruptcy filing. Step 1: File Chapter 7 or Chapter 13 bankruptcy. Step 2: File a complaint initiating an adversary proceeding against your student loan servicer/holder. Step 3: Complete the DOJ's attestation form (for federal loans). Step 4: Provide evidence of your financial situation. Step 5: Negotiate with the government/lender or proceed to trial.
Consider getting a bankruptcy attorney experienced in student loan adversary proceedings. Some legal aid organizations and law school clinics specialize in this. The landscape has shifted dramatically in favor of borrowers since 2022.
Frequently Asked Questions
What percentage of people who try to discharge student loans succeed?
Historically under 1%, but that figure is outdated. Since the 2022 DOJ policy change, the success rate for borrowers who file adversary proceedings has increased dramatically. The DOJ now consents to discharge in many cases where the Brunner test is clearly met.
Do I need a lawyer for a student loan adversary proceeding?
Strongly recommended. Adversary proceedings involve separate pleadings, discovery, and potentially trial. Many legal aid organizations and law school clinics handle these cases for free or reduced cost. The National Consumer Law Center maintains a list of resources.
Can I discharge private student loans in bankruptcy?
Private student loans are also subject to the undue hardship standard, but private lenders (unlike the DOJ) haven't adopted a streamlined consent process. You'll need to litigate the Brunner test. However, courts have been increasingly willing to discharge private student loans, especially when the education provided little economic value.
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