Student Loans and Bankruptcy
The Brunner Test’s Three Prongs
Minimal Living Standard
The Law Offices of
Baldwin and Briscoe have experienced attorneys who have dealt with, and
continue to deal with bankruptcy cases. One such bankruptcy matter we here at
the Law Offices of Baldwin and Briscoe handle is student loan debts when it
comes to bankruptcy. We have fought and
continue to fight to have your student loans absorbed.
The Brunner test is the test used in Maryland to obtain “undue
hardship” discharge of student loan debt.
The three step test, also known as the three prong tests, entails:
1. That the debtor, based on current income and
expenses, cannot maintain the “minimal” standard of living for themselves and
their dependents, if they have to pay back the debt;
2. That the debtor has additional circumstances
that will exist throughout the significance of the repayment period; and
3. That the debtor has made “good faith” efforts
to pay back the loans.
In proving that a person has undue hardship,
that person must put on evidence before the court that satisfies the elements
of the Brunner’s test. The “undue
hardship” Brunner test is to help safeguard loan providers from abusive
The Brunner Test’s Three Prongs
For the first elements of the test, the court
must do a calculation of the “minimal” standard of living in a certain
area. In doing so, the court must
determine the “minimal” amount of money needed for food, clothing, medical
expenses, and shelter, and subtract that amount from what the person makes. If
the total monthly expense for the debtor equals or exceeds the amount of money
he or she makes, then the court will determine that he or she meets the
“minimal” living standard of the test. For example, the minimal living expenses
in St. Mary’s County, Maryland, might be lower than the minimal living expenses
for someone living in Baltimore City.
For the second prong of the Brunner test, the
plaintiff must show certainty of hopelessness in his or her abilities to pay
back the loan. To show a certainty of
hopelessness in proving “additional circumstances,” the debtor must show that
he or she suffers from an illness, disability, lack of usable job skills, or
the existence of a large number of dependents.
If the debtor can prove just one of the factors of certainty of hopelessness
listed above, then the plaintiff meets the second prong of the Brunner
good faith prong of the Brunner’s test looks specifically at the debtor’s
efforts he or she has made at obtaining employment, maximizing income, and
minimizing expenses, to ensure that the debtor’s hardship occurs from
circumstances beyond the debtor’s control.
The “good faith” requirement of the Brunner test, however, does not mean
that the debtor has to pay on the loan, only that he or she tried to make an
effort to pay on the loan. Further, the debtor
should try to work with the lender to lower loan payments, but if he or she
does not do so, the debtor may still be relieved of the debt under the “good
faith” prong of the Brunner’s test.
If the debtor can prove that he or she
satisfies every element of the Brunner test, he or she will be discharged from
their student loans.
The information on this website is not legal
advice. For more information about your
specific legal matter, contact a practicing attorney at the Law Offices of
Baldwin and Briscoe.
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