Brunner test - Can it help you get rid of your student loan debt?

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By: Good Nelly
on 5th Oct,2015

Do you want to get a discharge from your student loan debt through bankruptcy? Check out how qualifying a Brunner test can help you do so.
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Are you thinking of filing a bankruptcy to get rid of your student loan debt? You should know that it’s not possible under normal circumstances. To qualify for it, you need to meet certain eligibility requirements under Brunner test. Go through this article to know how you can get rid of your student loans through bankruptcy.

Brunner test - How can it come to your help?

Usually, student loans cannot be discharged by filing a Chapter 7 or a Chapter 13 bankruptcy. However, if you can prove your undue hardship to the court, then you can get rid of your student loans through bankruptcy. But, the bankruptcy law hasn’t defined the actual meaning of undue hardship. However, some courts use Brunner test to determine whether or not the debtor is actually facing financial hardship.

What are the eligibility requirements of a Brunner test?

To discharge your debts through bankruptcy, you need to qualify the following 3 criteria:

  • Poverty - You have to show that with your current income and expenses, you cannot maintain a minimal standard of living for yourself and your dependents if you’ve to pay off your student loans.
  • Persistence -There is a chance that your present financial condition is likely to continue for a substantial amount of your loan repayment period; it may continue even for a longer time.
  • Good faith - You have really tried hard to repay your student loans in the past, by changing your spending habits.

How can you prove your eligibility of these 3 criteria?

To qualify the Brunner test, you need to prove to the court that you’re either near to or living below the poverty line. The court will see that you haven’t spent your money on luxury possessions or bought any personal possessions. The court will verify that you’re struggling to meet your and dependents’ daily necessities.

Can you get a discharge from your entire student loan?

Most of the courts grant a discharge from either your entire student loan debt or nothing. However, there are some courts which can discharge the debtors from a portion of their student loans.

Will this test help you get a discharge from your private student loans?

Yes, you can get a discharge from your private student loans if you’re able to qualify the Brunner test.

Usually, you can repay your federal student loans through federal loan consolidation programs. However, you may be eligible for discharge from your FFEL Program loan or Direct Loan under the following circumstances:

  • Victim of identity theft - You were a victim of identity theft and your loan was falsely certified.
  • False certification of eligibility - You didn’t meet the ability to benefit student eligibility requirements and your school falsely certified the loan.
  • Disqualification from employment - The school certified your eligibility but you’ve been disqualified from employment, in the specific occupation, in which you received the training, due to mental/physical condition, criminal record, age, or any other reason.
  • Name on the application without authorization - Your school had signed your name on the promissory note or on the application without you authorizing, or the school endorsing your loan check or signing your authorization for electronic transfer of funds without you knowing it. However, the situation will be different if the loan proceeds were delivered to you or it was used to satisfy the charges, which you owed to the school.

Read on: Federal and private student loans - Differences change everything

What are your chances of getting a discharge from your student loan debt?

Your chances of getting a discharge from your private student loan debt increase if you’re 50 years of age or older. This is because, the bankruptcy courts are usually not willing to discharge student loans. However, if you can show through Brunner test that you’ll likely to remain poor for the rest of your life, and you’ve tried to repay your student loans, then the bankruptcy court might give you discharge from your student loan debt.

Check out how you can repay your student loan debt

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