Filing bankruptcy to eliminate student load debt

A recent appeals court ruling has a significant impact on people filing bankruptcy to eliminate student load debt.  As reported in the July 15th Minneapolis Star Tribune, the defendant—Mark Jesperson of Grand Marais, MN-- won in the bankruptcy and District courts based on claims of “undue hardship”.  Those rulings, however, were overturned by the Eighth U.S. Court of Appeals, which determined that he had failed to make a single payment on his considerable loans and had failed to take advantage of special programs which allowed for reduced payments over a 25 year period for those in poverty situations.

Typically student loan debt carries a higher standard called “undue hardship” before someone can escape the debt obligation.  In this case, the court stated that Jesperson’s youth, health, marketable skills and other factors contributed to denying him the “undue hardship” discharge.  To read the article in full, visit

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