A fairly common myth is that student loans cannot be discharged through bankruptcy (USA). For example, this NPR article discusses the myth and its falsity.

While I have been able to find plenty of information about discharging student loans, I have been unable to figure out the origin — or even the intended meaning — of the myth that “student loans cannot be discharged through bankruptcy”. Here are some of the ways that student loans are different:

  1. They can only be discharged through chapter 7/13 bankruptcy.
  2. Discharge is not automatic but requires an “adversary proceeding” where it must be established that repayment would present an “undue financial hardship”.
  3. Financial hardship is determined by the “Brunner test”, established in the late 80’s (1987; Brunner v. New York State Higher Education Services Corp) and is relatively difficult to establish.

Given these differences, “student loans can’t be discharged” might be a sloppy way to state the claims that

Student loans are not automatically discharged.


Student loans are exceedingly difficult to discharge, to the point that it might be said to be “practically impossible”.

The first claim is true, but doesn’t jive with how the myth is usually understood (as a claim of impossibility, not of “possibility with extra effort”). The second claim might be true, but could be misleading. While they are very onerous to discharge, this study referenced in the NPR article found that, while only 0.1% of bankruptcy filers attempt to discharge their student loan debt, those who do attempt to discharge their debt achieve some measure of success roughly 40% of the time (admittedly small sample size; but anything above maybe 20% or so would strike me as in tension with the claim of “practical impossibility”).

Instead of being a sloppy statement of some true-ish claim, the myth could be a piece of propaganda propagated by lenders in a manner similar to the fossil fuel industry’s push of climate change denial against their own research. I haven’t found any evidence of this, however.

Where does the myth that student loans cannot be discharged through bankruptcy originate?

  • 8
    This question doesn’t seem to be on topic because it’s not asking “is [notable claim] true?” That being said, Iuliano explains what he thinks is the origin of the idea that student loan bankruptcy is hard in the paper you linked, right on page 26 (though it seems like a hypothesis to me).
    – Laurel
    Dec 26, 2020 at 15:53
  • @Laurel I was under the impression that origin questions were on-topic. Here’s a popular-ish example and a Meta question it led to. But I know that questions of topicality on SE can be somewhat shifty, so if origins are off-topic that’s fine.
    – Dennis
    Dec 26, 2020 at 16:08
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    The other question is on topic because “the myth started in WWII” is the notable claim. And I made a mistake, the paper that addresses this on p26 is this other one.
    – Laurel
    Dec 26, 2020 at 16:23
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    I reject the premise of this question. It relies on an assumption of a single cause.
    – Oddthinking
    Dec 26, 2020 at 18:03
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    @Dennis: What if the cause is 1000 cases of "someone misunderstood"+15 cases of "a cell centre agent wanted to go to lunch, and told a customer a lie"+22 cases of "the full truth was too long for a tweet"+"poor financial education in schools"+"it fit into people's political preconceptions, so the myth tended to be shared where the truth didn't"+"the whole student funding system is broken"+"it isn't actually widely believed"+"it was misheard"->"the phone connection was poor"->"it is all because they changed to a cheaper VoIP codec". You assume there is a nice neat answer.
    – Oddthinking
    Dec 27, 2020 at 7:06

1 Answer 1


This is not a site for legal advice, but this is generally covered by 11 U.S. Code § 523 which says

(a) A discharge under section 727, 1141, 1192, 1228(a), 1228(b), or 1328(b) of this title does not discharge an individual debtor from any debt—


(8) unless excepting such debt from discharge under this paragraph would impose an undue hardship on the debtor and the debtor’s dependents, for—


(i) an educational benefit overpayment or loan made, insured, or guaranteed by a governmental unit, or made under any program funded in whole or in part by a governmental unit or nonprofit institution; or

(ii) an obligation to repay funds received as an educational benefit, scholarship, or stipend; or

(B) any other educational loan that is a qualified education loan, as defined in section 221(d)(1) of the Internal Revenue Code of 1986, incurred by a debtor who is an individual;


So saying “student loans can’t be discharged” appears to be the general rule, though there are exceptions, particularly if the court believes “undue hardship” can be shown. There was such a case in New York in July 2020.

  • This seems to be arguing "It isn't really a myth. It is mostly correct, except for exceptional circumstances." So rather than saying where the myth comes from, it is denying a premise of the question. Is that right?
    – Oddthinking
    Dec 27, 2020 at 7:09
  • @Oddthinking It is saying that “student loans can’t be discharged” comes from US legislation, and notes that legislation provides an exception
    – Henry
    Dec 27, 2020 at 15:26
  • Yes, I can see it literally says that. But that doesn't seem to address the question. It doesn't ask whether student loans can be discharged, but instead takes that as a premise. I am trying to see how this can be seen as an answer to the question.
    – Oddthinking
    Dec 27, 2020 at 16:31
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    I'd consider it an answer, because it cites a reliable source which not only explains the belief but specifically cites the exceptions OP knows about and is even an official (canonical) public document. It's sometimes hard to find a source for generally held beliefs, but as long as we're down to educated speculation, this is some pretty solid speculation. Dec 28, 2020 at 20:37

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