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Wall Street Journal

It’s nearly impossible to cancel your student loan debt in bankruptcy.

Fewer than 1,000 people try each year. Those who do are required to file a lawsuit against their lenders and then convince a bankruptcy judge that they’re so poor there’s no hope of ever repaying the loans.

Lawyers for the U.S. Department of Education, which guarantees most of the roughly $1 trillion in outstanding student loan debt, have been criticized for making unreasonable arguments to sway judges that struggling borrowers can afford their monthly student loan payments. Here are five of them.


When a Minnesota woman tried to discharge more than $300,000 in student loans in 2007, lawyers for the lenders focused on her and her husband’s five kids, asking her at trial whether they were “planned.” The woman, who had gone to medical school, said she’s Roman Catholic and that two children had autism, preventing her from working. Her husband was a police officer.

“You have to make the decision to have a family in light of what you can afford,” one lawyer said.

Bankruptcy Judge Gregory Kishel found the argument “audacious,” stating that siding with the lenders would infringe on “religious practice and fundamental life-choice.”

“[The couple] brought five human lives into existence; and though it has not been without struggle, they are nurturing them in a safe, intact, two-parent family,” he said, discharging the loans. (Lender lawyers appealed the decision twice.)

In another instance, lawyers pointed out that a 34-four-year old Alabama woman “chose to have three children even though she had no husband and her health was allegedly so poor” that she couldn’t work. That argument prompted a judge to write, “There is nothing in the Bankruptcy Code that suggests that Congress did not intend for student loan debtors to procreate.”


A Montana man graduated from Yale University with a master’s degree but struggled to repay roughly $130,000 in loans on his $12.41 hourly wage at a sheriff’s office.

Lawyers who examined his expenses criticized the man for taking antidepressants for his mental health problems. The criticism was so aggressive that a bankruptcy judge wrote in a 2006 opinion that he was “bothered by the apparent attack” on the man’s drug use. Lawyers also tried to convince a bankruptcy judge that the 43-year-old man should drive 800 miles to a South Dakota Indian reservation where he could get cheaper medications.

“The court was equally unimpressed by counsel’s suggestion that [the borrower] could simply use his vacation time to make the suggested monthly journeys,” the judge said before discharging the student loan debt.


Lawyers who argued that a 25-year-old woman could afford to repay her student loans—more than $40,000—said her jailed husband could pitch in.

“Upon his release, it is reasonable to assume that he will provide some financial support,” wrote student loan lawyers in 2008. His wife, a New Hampshire woman making about $30,000 a year, was supporting their two-year-old daughter, according to court papers.

Bankruptcy Judge J. Michael Deasy didn’t buy it, pointing out that her husband hadn’t shared his earnings in the past.

“The undisputed evidence at trial was that during the three years prior to his incarceration, [the woman] never saw her husband’s paycheck; rather, he kept his paycheck and used it to pay his own expenses,” wrote Judge Deasy, who determined the woman couldn’t even afford the reduced payment of $206.72 per month offered by a lender.

“No basis exists to conclude that there will be any net contribution from the husband,” he said before discharging the loans.


Student loan attorneys tried to convince a Minnesota bankruptcy judge in 2008 that a 53-year-old woman should try to pay off a $50,000 student loan bill by opening a children’s daycare center—even though she was blind and sleeping on the floor of her adult son’s apartment.

Doing the math for her in court papers, the attorneys figured she could charge in $86,400 a year based on a license she once had to run a daycare with 12 children.

“[The woman] still has an interest in operating a daycare center and is still capable of doing so should her living situation change,” they wrote in court papers.

The woman lived off her $569 monthly social security-disability check and didn’t own a home, a car or even furniture, said her attorney, Barbara May.

“There’s no doubt she would have gotten rid of these” loans if she had shown up to her trial, said Ms. May, who said she didn’t charge the woman for the $25,000 worth of legal work on the case. “She was just burned out….They had run her down.”


That’s what student loan attorneys told divorced mother of two kids (ages 1 and 2) in Kentucky who worked at a casino when she began trying to get rid of her loans in 2007.

The attorneys said in court papers that the 26-year-old woman, who made $9 an hour, was “not only in the prime of her earning years but has many left ahead of her.”

“Though [she] is gainfully employed, there are no obvious barriers to her supplementing his [sic] income with another part-time job,” they said in court papers.

The woman’s roughly $23,000 student loan tab came from a culinary arts degree from Sullivan University that she stopped pursuing because of pregnancy complications, according to court papers. Before a judge could rule on the matter, the woman signed up for a federal program that adjusted her monthly loan payments to match her income