A student loan bankruptcy lawyer can review your situation and help prove that repaying education debt causes you an undue hardship. The right choice for you will depend less on where you live and more on your personal finances.
Any bankruptcy attorney can help you file bankruptcy to clear credit card debt, medical bills, and other consumer types of debt. But finding a lawyer to help you discharge student loan debt can be challenging. Few are willing to do it, and fewer have done it successfully.
The right student loan bankruptcy lawyer can review your federal and private student loans, financial situation, and bankruptcy cases where you live to identify your chances of meeting the undue hardship standard.
Ahead, learn what a student loan bankruptcy lawyer is, the benefits and cost of hiring one, and a list of the best lawyers to help you wipe out your education debt.
What is a student loan bankruptcy lawyer?
A student loan bankruptcy lawyer is an attorney with advanced knowledge of student loans and the process to discharge those types of debt in bankruptcy court. They are a student loan attorney, meaning they have a deep understanding of federal and private student loans. But they also are familiar with the bankruptcy code, mainly 11 USC § 523(a)(8), and the different protection each type of loan receives.
The attorney will understand:
- The different types of loans the Department of Education offers — FFEL, Direct, and Parent PLUS — student loan borrowers.
- Repayment options for federal loans — e.g., income-driven repayment plans — and private student loans — interest-only.
- Available student loan forgiveness programs for public service, severe disability, fraud, etc.
- How to meet the undue hardship standard under the Brunner Test and the totality of the circumstances test.
- When to file an adversary proceeding in a Chapter 7 or Chapter 13 bankruptcy case.
- Alternative options if getting a bankruptcy discharge is unlikely — refinance, settlement, consolidation, income-based repayment, etc.
The lawyer who handles your student loans can differ from the bankruptcy lawyer you hired to file your bankruptcy case.
If the idea of hiring a lawyer is a bit overwhelming, another option is to speak with a student loan advisor.
What to look for when hiring a student loan bankruptcy lawyer?
The quality of services offered by student loan bankruptcy lawyers can vary considerably. As a result, finding a qualified and experienced attorney to help with your student loan issues takes effort. When hiring a lawyer to help with your bankruptcy case, look for these three factors.
Law license and bankruptcy court admissions: An attorney needs a law license to practice law in a state and permission to appear in the court where you live. You can find an attorney's law license by visiting the website of your state's bar association. To find out if they have permission to practice in the bankruptcy court near you. If they don't, they may be able to file a motion to appear pro hac vice on your behalf, or they can ask the court to be admitted.
Qualifications and experience: A law degree is the only education qualification needed to be a student loan bankruptcy lawyer. There aren't any specialized designations or credentials attorneys receive to solve student loan issues. Consequently, you'll need to check to see if they have experience helping borrowers inside and outside of bankruptcy with their student loans.
Client testimonials: Read the online reviews of the student loan bankruptcy lawyer's services. Ask the attorney if they have any case studies or video testimonials from previous clients.
For example, here's a video from a single mother I helped to reopen her Chapter 7 bankruptcy case and discharge over $80 thousand in private student loans.
Can I file student loan hardship bankruptcy without a lawyer?
You can file a student loan hardship bankruptcy without a lawyer. But to do it well might take you hundreds of hours to understand bankruptcy law and the process to file an adversary proceeding for student loans. For example, earlier this year, a Californian woman, Mis Loe, successfully navigated the bankruptcy process by herself to discharge over $350 thousand in federal student loan debt. Ms. Loe estimates she spent 1,000 hours reading hundreds of student debt cases and preparing a 180-page complaint.
"I gave them everything. There was no way I was going to file this and not prove it in every way possible," Mis Loe said in an interview with CBS News.
If you're up to the challenge, check out these great free resources I've created for you:
- Student Loan Bankruptcy: All Your Questions, Answered
- When Did Student Loans Become Non-dischargeable in Bankruptcy?
- Private Student Loans Bankruptcy: Are They Dischargeable?
- Parent PLUS Loan Bankruptcy: Before and After You File
- Sample Student Loan Adversary Undue Hardship Complaint
When to hire a lawyer
You should hire a student loan bankruptcy lawyer when you're ready to start the bankruptcy proceedings to discharge your loans. You can hire them before or after your case ends. However, it's advisable to meet with the lawyer before you file bankruptcy to improve your odds of getting a discharge. For example, during that meeting (which can be a paid or free consultation), the lawyer can review your student loans, past and current income, and other additional circumstances to offer their legal advice about whether you should pursue other alternatives before filing a case.
The goal is to help prove to the court that you've exhausted options, and the only way you can dig out of this student loan black hole is to wipe out your debt.
Cost of hiring a lawyer
Unless you can find a law firm that handles undue hardship cases for free or at a steeply discounted rate (pro bono), you'll be charged a fee for the services. The amount varies based on the attorney and the type of fees they charge. Here are some common types of fee structures.
Hourly rate: This one's just like it sounds. The lawyer charges an hourly fee for every hour spent working for you. The upside is you're only charged for the time the lawyer spends creating working on your case. The downside is you won't know for sure how long it will take, which can cause you to pay more than you expected.
Flat Fee: In a flat-fee model, your lawyer charges a set amount of money for the service. Unlike hourly rate arrangements, the flat fee ensures you know how much you're going to pay before the case begins. The flat fee can be paid in a lump sum or in installments under a monthly payment plan.
Contingency: The contingency payment moves the financial risk to the lawyer — they get paid only if they achieve the desired result (i.e., bankruptcy discharge or settlement).
Hybrid: A hybrid payment structure typically involves an initial flat fee made at the beginning of the case and then a contingent fee due only if the lawyer discharges your debt.
Questions to ask
Many student loan bankruptcy lawyers offer free consultations, so it makes sense to use that opportunity to find a lawyer you're comfortable with.
When you take those meetings, it's important to be prepared. Here's a list of some questions to ask to help evaluate them.
What undue hardship test will I need to pass? Depending on where you live, the bankruptcy judge will use the Brunner Test or the totality of the circumstances test to determine whether you can repay your loans and maintain a minimal standard of living for yourself and your dependents without undue hardship. Many experts believe the Brunner Test is harder to pass because you have to prove you made a good faith effort to pay your loans (e.g., made several student loan payments, requested deferments, and forbearances, etc.).
How many student loan bankruptcy cases do you file each year? Keep in mind that few people try to meet the legal standard to discharge their student loan debt. Ideally, you'd like an attorney who files at least one case a year.
Have you worked with my lender previously? Although prior experience with a servicer or lender isn't necessary, it's helpful. Each lender has its own process for defending student loan discharge cases. Knowing how each company has responded in the past may give you a leg up.
Who's going to handle my case? Given the complexity of undue hardship cases and the amount of debt at stake, I don't recommend having a paralegal be your primary point of contact. It's essential your lawyer works closely with you from the beginning and knows the ins and outs of your financial situation.
What's your fee structure? Many attorneys are willing to work with you to set up a payment plan to pay their fees. However, some may require full payment before they file your case.
8 Best Student Loan Bankruptcy Lawyers
The student loan bankruptcy lawyer community is tiny. Of those lawyers that claim they help with student loans, there is only a handful that I can recommend based on my knowledge of their skill and experience.
Full disclosure, I list myself first. Why? There are few bankruptcy or student loan lawyers who have filed as many student loan adversary proceeding cases and been as successful.
- Stanley Tate (based in Kansas City, but I help people no matter where they live)
- Jay Fleischman (California and New York)
- Christine Kingston (California)
- Josh Cohen (Connecticut and Vermont)
- Christie Arkovich (Florida)
- Austin Smith (New York)
- Latife Neu (Washington)
- Natalie Jean Baptiste (New York)
Few bankruptcy attorneys have experience discharging student loan debt. You can spend hours on Google, ask for referrals, and still fall short in your search.
If you'd like help from a skilled student loan bankruptcy lawyer, schedule a free 10-minute phone call with me. During our conversation, I'll ask questions to get an initial idea of whether filing a student loan bankruptcy case makes sense for you.
UP NEXT: Student Loan Forgiveness Programs