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"Undue Hardship" is Mitigated by Partner's Income

Posted on 02/01/2006 at 12:00 am by Molleur Law Offices
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Lorenz v. American Educational Services. The First Circuit Bankruptcy Appellate Panel reversed a Bankruptcy Court decision which had granted an undue hardship discharge of a student loan. The Panel held that the debtor's life partner's income had a substantial effect on the debtor's actual and necessary expenses (since the debtor and his partner acknowledged having one financial household) and should have been taken into account in the undue hardship determination.

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