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  • Writer's pictureDaniel Rodriguez

What is Considered Undue Hardship for Student Loans in CA?

What is an Undue Hardship? When you file for bankruptcy, you have the opportunity to claim an undue hardship to discharge your student loan debt. The undue hardship test, also known as the Brunner Test, requires the bankruptcy court to look at the totality of the circumstances when determining why you cannot afford to repay your loan. While the court’s analysis may differ from state to state, there are common factors that most courts will evaluate:

  1. Can the student loan borrower afford their living expenses if they must repay the loan?

  2. Are the borrower’s financial issues a long-term or temporary matter?

  3. Has the borrower made reasonable attempts to repay the loan? If the bankruptcy court believes that your financial problems stem solely from a lack of sound decisions, you will not be able to claim an undue hardship. The debtor must make a good faith attempt to repay their loans. To file for an undue hardship, you must file either a Chapter 7 bankruptcy or a Chapter 13 bankruptcy. Once you file for bankruptcy, you must then file a legal action known as an adversary proceeding. An adversary proceeding is a process where the debtor claims that repaying their loans would create a substantial undue hardship for themselves or their family. However, once you file for an adversary proceeding, your loan servicers will be able to dispute your undue hardship claim. This can affect whether the bankruptcy court accepts or rejects the claim. To learn more about filing for an undue hardship, you should continue reading and speak to an experienced California bankruptcy attorney as soon as possible.

How to Prove Your Student Loan Discharge Claim You need to provide the court with detailed legal records if you want to claim an undue hardship. For example, submitting a spreadsheet that outlines your living expenses can help you prove that you do not have the funds to repay the loan. This outline should contain everything from rent payments and credit card debt to money used for groceries. If a serious illness is keeping you from repaying your loans, you should document that information as well. Keep track of all money used for medical bills, prescriptions, rehabilitation, and any other expenses related to your treatment. If your health status made it impossible for you to continue working, you should also thoroughly document how it affected your ability to work. Another important piece of evidence is documentation proving that you kept in constant contact with your loan servicer. If you have not made any payments on your loans and you cannot prove that you reached out to your loan servicer to attempt to make payment arrangements, the court may not accept your hardship claim. You should keep track of any conversations you had with a loan servicer; this includes phone calls, emails, meetings, or any other form of communication. After proving an undue hardship claim, there are a number of different outcomes that may occur. One outcome is that your loans are discharged, and you no longer have to pay them. Another scenario is that some of your student loan debt is eliminated and you are responsible for repaying the remainder. It is also possible for your loan amount to remain the same, but for your interest rate to be lowered. There may be other exceptions that you can claim under certain circumstances. For example, if you are declared totally and permanently disabled, your loans may be completely discharged. You should speak to an experienced attorney to help you determine what exceptions you may qualify for.

Our California Bankruptcy Attorneys are Ready to Work with You If you or a family member would like assistance determining whether you qualify for an undue hardship, you should consult with an experienced California bankruptcy attorney today. The Bankruptcy Group has represented residents of Roseville, Folsom, and other communities across California, and we would be proud to work with you. You do not have to deal with your student loan debt alone; call The Bankruptcy Group at for a free legal consultation.

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