In re: KEITH MASON, Debtor, EDUCATIONAL CREDIT MANAGEMENT CORPORATION, Appellant, v. KEITH MASON, Appellee., 464 F.3d 878

Summary

At issue in the proceeding was approximately $ 100,000 in federally-assisted loans for law school, which was owed to the creditor. Despite the debtor's education, he had difficulty putting his education to use because of a learning disability. The bankruptcy court held that full repayment of the loans would cause the debtor an undue hardship within the meaning of 11 U.S.C.S. § 523(a)(8). It therefore discharged all amounts that the debtor owed to the creditor in excess of $ 32,400. The appellate court noted that it had to apply the three-part Brunner test to determine if excepting student debt from discharge would impose an undue hardship. The court found that the first and second prong of the test had been met, but the debtor had not met his burden of establishing good faith in attempting to pay back the student loans, which was the third prong of the Brunner test. While the debtor had minimized his expenses, he had not maximized his income, nor had he made adequate efforts to obtain ...