Well, in an interesting case, a federal court judge decided that an individual with Asperger's Syndrome who had struggled to hold down a job was entitled to having her student loans discharged as a result of "undue hardship." In re Todd, 2012 WL 1862341 (Bankr. D. Md. May 17, 2012)
I haven't read the whole case. Before even trying to pull it up, a number of questions came to mind. What does the language in the loan agreement say about undue hardship and does that language support a finding of undue hardship in this case? What, if any, firm criteria did the judge articulate for someone's disability to be deemed an undue hardship? How severe/mild does a person's disability have to be? How many times do you have to have been rejected by employers or fired from a job? How, if at all, does the analysis change if the individual is receiving or not receiving counseling/support services to improve in areas of weakness? Are there any factors that would reduce the % of debt that can be forgiven?
I was able to pull up the case and glance at it briefly. It turns out that the term "undue hardship" is not defined by the Bankruptcy Code but has been defined by the courts. Student loan debt is generally not discharged unless holding the individual to the debt would impose an undue hardship on the debtor and the debtor's dependents, and there is a three-part test to make that determination:
Case available at:
In re Todd, 2012 WL 1862341 (Bankr. D. Md. May 17, 2012)