I always assumed that you could not discharge student loans through bankruptcy, but apparantly you can . . . under certain circumstances.
This article from the New York Times outlines how this is possible, and how more former students are starting to have success in wiping out their student debt.
The article highlights a significant shift in the landscape of student loan debt relief through bankruptcy. Historically, student loans have been notoriously difficult to discharge in bankruptcy, often requiring borrowers to prove “undue hardship” via a separate, costly adversary proceeding. This led to a widespread perception that discharge was nearly impossible, deterring most borrowers from even attempting it.
A recent study by Jason Iuliano, a professor at the University of Utah’s S.J. Quinney College of Law, reveals a marked improvement. Analyzing approximately 650 cases filed between mid-October 2022 and mid-November 2023, Iuliano found that borrowers now succeed in discharging most or all of their student loans 87% of the time—up from 61% in 2017 and more than double the rate from nearly two decades ago. Published in The American Bankruptcy Law Journal, the research attributes this surge primarily to a streamlined process introduced in November 2022 by the Justice and Education Departments under the Biden administration.
The new guidelines provide clearer criteria for “undue hardship” and allow borrowers to submit evidence via a simplified 15-page attestation form. This reduces the adversarial nature of proceedings, as the government often recommends discharge if the form demonstrates hardship—such as expenses exceeding income, age over 65, or loans in repayment for at least 10 years. Judges typically approve these recommendations, making the process less burdensome.
There’s no guarantee with this process, and who knows what the Trump administration will do here. They seem to enjoy screwing over consumers. But the potential for relief is real.
Still, very few people are taking advnatage of this, though the numbers are rising. Iuliano estimates that 99% of eligible bankruptcy filers do not pursue student loan discharge, often due to lingering myths or uninformed legal advice. However, filings are rising: 1,693 adversary proceedings were initiated in 2025, a 12% increase from 2024 and 92% higher than 2023, per data from legal services firm Stretto. Typical successful borrowers are middle-aged (average 47), predominantly women, owing around $115,000, with monthly expenses outpacing income.
Hopefully, more people will take advantage of this and start to close the “student loan bankruptcy gap.”
