Discharging Student Loans via Bankruptcy: Undue Hardship Doctrine in the First Circuit

Student loans are presumptively non-dischargeable through bankruptcy, but the undue hardship doctrine provides an equitable “safety valve” for the indigent. To date, the United States First Circuit Court of Appeals has yet to select a single legal test for determining undue hardship under the United States Bankruptcy Code (“Bankruptcy Code”). Within the jurisdiction of the First Circuit, bankruptcy courts are free to choose an approach to evaluate undue hardship. In an effort to ensure consistency throughout the bankruptcy courts within the First Circuit, it would be ideal if the First Circuit would choose one of the undue hardship tests. However, until the First Circuit changes its position, the concept of undue hardship will be left open to judicial interpretation. This note explores the various undue hardship tests available to the First Circuit, and provides examples of how those tests have been applied by different courts. The two dominant tests in the First Circuit, the Brunner test and the Totality of the Circumstances test, will be explored in depth