Student-loan debt—now totaling more than $1.3 trillion—has garnered increased public attention, including in the recent presidential campaign. An important aspect of policy debates over that debt is what happens to borrowers unable to repay. With most forms of consumer debt, discharge in bankruptcy provides one option for struggling borrowers. But this alternative is often unavailable in the case of student loans, as borrowers must satisfy a stringent legal test known as the undue hardship standard to qualify for discharge.
