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  • Writer's pictureAdam Dayan, Esq.

Student Loans Discharged For Individual With Asperger's

While the IDEA protects children with disabilities between the ages of 3 and 21 who are entitled to certain special education programs and services, and has the purpose of preparing children for employment and independent living, it generally does not provide for supports into adulthood (with some limited exceptions). So what happens to individuals with disabilities who, as adults, struggle to secure and maintain employment? What type of accommodations should be made?

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:

(1) The debtor cannot maintain, based on current income and expenses, a minimal standard of living for herself and her dependents if forced to repay the loans; (2) Additional circumstances exist indicating that this state of affairs is likely to persist for a significant portion of the repayment period of the student loans; and (3) The debtor has made good faith efforts to repay the loans. Brunner, 831 F.2d at 396. The debtor has the burden of proof on all three points by a preponderance of the evidence. Frushour, 433 F.3d at 400. Discharging student debt is a rare occurrence. Here, however, the court found that all three requirements had been met and discharged all of the student loans. It will be interesting to see whether the loan provider appeals and how this all shakes out. Will there be a flurry of more cases like this? How will this decision affect the way loan providers deal with individuals with disabilities in the future? Story available at:

Case available at:

In re Todd, 2012 WL 1862341 (Bankr. D. Md. May 17, 2012)


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