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One of the most consequential — and least understood — facts about discharging student loans in bankruptcy is that federal and private loans are treated very differently. A borrower carrying both may face two separate paths to relief, with very different standards of proof. Sorting out which loans you have is the essential first step.
Federal Student Loans: The Undue-Hardship Path
Federal student loans — Direct Loans, FFEL loans, Perkins Loans, and similar federally held or guaranteed debt — are presumptively nondischargeable under 11 U.S.C. §523(a)(8). To discharge them, you must file an adversary proceeding and prove that repayment would impose an undue hardship, evaluated under the Brunner test in most circuits or a totality-of-circumstances standard in others. Since November 17, 2022, the DOJ and Department of Education attestation process (justice.gov) has streamlined this path: government attorneys assess a sworn attestation and can recommend full or partial discharge when the criteria are met. Reflecting cases brought under that process, studentaid.gov reports that courts granted full or partial discharge in approximately 98% of cases decided November 2022 through March 2024.
Private Student Loans: Often General Unsecured Debt
Private student loans are different. While certain "qualified education loans" can be subject to the same §523(a)(8) treatment, many private loans fall outside that protection — for example, loans that were not qualified education loans, or amounts borrowed beyond the school's cost of attendance. Those loans are treated as general unsecured debt, dischargeable in bankruptcy without proving undue hardship at all (studentaid.gov; CFPB). For many borrowers this is a revelation: private loans they assumed were permanent may be wiped out like credit card or medical debt. Determining whether a given private loan qualifies for this treatment requires reviewing the loan's terms and how it was used.
Why the Distinction Matters So Much
The practical effect is large. A borrower with $40,000 in private loans that qualify as general unsecured debt may see them discharged in an ordinary Chapter 7 without ever litigating undue hardship — while their federal loans require the adversary proceeding. Treating all student debt as one undifferentiated, undischargeable block is a costly mistake: it can lead borrowers to give up on relief that is actually available to them.
How to Tell What You Have
Federal loans appear in your account at studentaid.gov and are serviced by federal servicers; they carry federal protections such as income-driven repayment. Private loans come from banks, credit unions, or online lenders and appear on your credit report but not in your federal studentaid.gov account. If you are unsure, pulling your studentaid.gov record and your credit report together will usually reveal the full picture. An attorney can then classify each loan and map the right path.
Getting an Evaluation
Because the path differs by loan type — and because private-loan dischargeability turns on technical questions about whether a loan is a "qualified education loan" — these cases reward careful review. People's Justice is not a law firm and does not provide legal advice; we connect you with licensed attorneys, and we are not a government agency. No outcome is guaranteed; whether your loans can be discharged depends on your facts and a court's decision. A qualified attorney can review your specific loans and advise on which may be dischargeable and how.
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- The Adversary Proceeding, Step by StepDischarging student loans is not automatic in bankruptcy — you must file a separate lawsuit within your case called an adversary proceeding and prove undue hardship under 11 U.S.C. §523(a)(8). Under FRBP 4007(b) the request can be brought at any time and there is no separate filing fee for this proceeding. The November 17, 2022 DOJ and Education Department attestation process is used inside this proceeding. No outcome is guaranteed; the result depends on your facts and a court's decision.
- The DOJ Attestation FormOn November 17, 2022, the Department of Justice and Department of Education introduced a sworn attestation form that streamlined how student-loan discharge requests are evaluated in bankruptcy. Government attorneys use the disclosed income, assets, and expenses to assess undue hardship under 11 U.S.C. §523(a)(8) and can recommend full or partial discharge when the criteria are met. The guidance does not bind courts. No outcome is guaranteed; the result depends on your facts and a court's decision.
- The Brunner Test, ExplainedMost federal circuits decide whether student loans cause an "undue hardship" under 11 U.S.C. §523(a)(8) using the three-prong Brunner test: present inability to maintain a minimal standard of living if forced to repay, persistence of that hardship, and good-faith repayment efforts. Some circuits use a totality-of-circumstances standard instead. No outcome is guaranteed; whether you meet the standard depends on your facts and a court's decision.
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