Student Debt Attorney in North Platte

Nebraska Bankruptcy Guidance for Borrowers Facing Student Loan Problems

Lentz Law, PC, LLO has spent over a decade helping Nebraska residents work through serious financial distress, and we bring that same no-judgment, tailored approach to clients across North Platte and the surrounding area. We take the time to understand your full financial picture before recommending a path forward.

Our goal isn’t to push you into a process that doesn’t fit. It’s to help you reclaim control of your finances with clear options and honest guidance.

If student loans, garnishments, or creditor calls have become unmanageable, call us today at (402) 526-5540 or use our contact form to schedule a free consultation. Same-day appointments are available.

Can Bankruptcy Discharge Student Loans?

Under 11 U.S.C. 523(a)(8), student loans are generally not dischargeable in bankruptcy. Both federal and most private student loans fall under this rule. To seek discharge, a borrower must prove that repaying the debt would impose an “undue hardship” on them and their dependents, and that argument must be made through a separate lawsuit within the bankruptcy case called an adversary proceeding.

The Bankruptcy Code doesn’t define undue hardship, so courts have developed their own standards. What that means for your case depends heavily on where you file.

Nebraska’s Totality-of-the-Circumstances Standard

Nebraska sits within the 8th Circuit, which applies a “totality of the circumstances” test for undue hardship. This is meaningfully different from the stricter three-part Brunner test used in most other circuits. Rather than requiring a borrower to satisfy each prong of a rigid formula, the 8th Circuit weighs your past, present, and reasonably reliable future financial resources against your reasonable and necessary living expenses, along with any other relevant facts.

This approach gives courts more flexibility to look at the full picture. Nebraska courts have described the burden of proving undue hardship as “rigorous” even under this standard, so the bar is real. In November 2022, the Department of Justice and Department of Education issued joint guidance creating a streamlined attestation process that has made discharge of federal student loans more attainable nationwide. We can help you evaluate whether your situation may clear that bar before any filing is made.