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Recent cases show discharge of student loan debt is rare

Ohio residents might choose to file for bankruptcy for any number of reasons regarding their debts. For many people, credit card debt has become unmanageable; for others, unexpected health crises have led to large amounts of medical debt. In general, one of the most difficult types of debt to have discharged in bankruptcy is student loan debt. This is because people in this situation are required to prove that they have suffered undue hardship -- which is, by design, a high bar to clear.

One woman thought she might have a compelling enough story to demonstrate this kind of hardship. She was diagnosed with pancreatic cancer, a disease that has relatively high mortality rates. The woman battled the disease successfully, but incurred large amounts of medical debt. Additionally, before she became ill, she had taken out $43,000 in student loans.

As a result, the woman elected to seek to have her student loans discharged in bankruptcy under the undue hardship clause. It seemed like a winnable argument; pancreatic cancer is often aggressive and could recur in the future. However, the agency in charge of ruling on such matters, called the Educational Credit Management Corporation, said that the woman was young and that survival rates for people of her age were better than older people. The agency also said that the mere possibility of the cancer's return wasn't enough to justify the discharge of student loan debt.

Every case is different, but many people in this situation might benefit from speaking with an experienced Ohio bankruptcy attorney for advice.

Source: The New York Times, "Loan Monitor Is Accused of Ruthless Tactics on Student Debt," Natalie Kitroeff, Jan. 1, 2014

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