Student Loans

Oregon Student Debt Book CoverThese FAQ about discharging student loans are excerpts from Oregon Student Debt: How to wipe out student loans in Oregon bankruptcy courts (2016).

The questions and answers are taken from actual discharge case opinions from the Ninth Circuit Court of Appeals, Ninth Circuit Bankruptcy Appellate Panel, Oregon district court, and Oregon bankruptcy court. For a free printed copy of our 84-page guide book, call 503-362-9393. To read the eBook online for free, click here. Author Michael Fuller practices consumer law as a partner at Olsen Daines PC. He teaches consumer law as an adjunct professor at Lewis & Clark Law School.

Unpaid tuition was actually a student loan, university argues in court

unpaid tuition

Last April, an Oregon judge ordered Portland State University to show cause why it shouldn’t be held in contempt for harassing a former student after bankruptcy.

Court records show the former student owed PSU unpaid tuition for classes in fall 2010. The University admits the former student never attended its classes, and University policy prohibited him from dropping them.

Rather than deny the harassment, PSU instead argued that its unpaid tuition was actually a “loan” that survived bankruptcy. Read the University’s response.

Bankruptcy Discharge of Student Loans Oregon Bankruptcy CourtStudent loans are often an exception to the fresh start provided by the Bankruptcy Code. Under § 523(a)(8), student loans are only discharged for borrowers facing undue hardships. Read more about how to wipe out student loans in Oregon bankruptcy courts.

In court, PSU’s attorney relied on its contractual language stating “if I am a student, any credit extended to me is an educational benefit or loan.”

In his motion, the former student cited court rulings from across the country that say unpaid tuition for unattended classes is not considered a student loan under the Bankruptcy Code. Read the former student’s motion for contempt.

Related articles:

Kanas court rules unpaid tuition is not a student loan

Portland teacher gets day in court against collector that harassed him

A preliminary hearing is set for July 6 in Portland Bankruptcy Court. Case No. 11-40345-tmb7.

How do I find my student loans?

Student Loans

ANSWER: Check the federal student loan data system and get your free credit reports.

Filing Student Loan Complaint in Oregon Bankruptcy CourtFind Your Student Loans

Your federal loans are listed in the National Student Loan Data System. You will need a PIN to check the federal system. Your private loans are usually listed on your credit report.

You are allowed to download your credit reports one time each year for free from

You must list each of your student loan companies on your bankruptcy complaint. If your loans have been transferred to various servicers over the years, list each one. If your student loan company isn’t listed in your complaint, the judge can’t wipe out its debts.


Student Loans List Forgive in Oregon Bankruptcy Court

Buying a New Car

New Car Student Loans Discharge Bankruptcy Oregon

QUESTION: Can I own or lease a new car and still meet the first Brunner prong?

ANSWER: You can buy a new car and still wipe out your student loans. However, your car must be economical. Avoid driving luxury cars or sports cars.

Be prepared to explain to the court why you need a reliable car to drive to work or take your kids to school. Be prepared to explain why you can’t take the bus instead.

Brunner undue hardship test Oregon bankruptcy courtNew Car Warranty and Mileage

Does your car payment include a warranty plan? Does your car get good gas mileage? These are all questions you should ask yourself before buying choosing the right car to buy.

You should also consider the added expenses of owning a car. Is public transit a smarter choice when you consider your car payment, warranty payment, general expenses and upkeep, gas, and full coverage insurance?

Retirement Savings

Retirement savings forgive student loans Oregon bankruptcy court

QUESTION: Can I have retirement savings and still meet the first Brunner prong?

ANSWER: Retirement savings may not be possible if you are having trouble paying your student loans. The court is more likely to forgive your student loans if you are not putting money away each month.

Retirement Savings Factors

Filing Student Loan Complaint in Oregon Bankruptcy CourtIf you are putting money away, be prepared to explain the following to the court:

  • why you need savings at your age
  • how you can justify saving money based on your income
  • what year you plan to retire
  • how much savings you already have
  • why your savings should not be used to care for your children