How To Fight Student Loan Debt in Bankruptcy: Adversary Proceedings Explained

What Is an Adversary Proceeding?

An adversary proceeding is a legal process that takes place as part of a bankruptcy case. Adversary proceedings  in bankruptcy cases achieve many different functions.

🎓 This article focuses primarily on how adversary proceedings work for student loan bankruptcy discharges. 

Secondarily, it touches on how else APs may be used in bankruptcy proceedings. For example, if a creditor wants to object to a specific debt being discharged in your bankruptcy case, they can file an adversary proceeding, which is a formal lawsuit. In this case, many filers choose to seek legal help by hiring an attorney or getting legal aid. 

What Is an Adversary Proceedings for Student Loans?

An adversary proceeding (AP) is a separate legal process you start within your bankruptcy case to ask the court to erase your federal student loan debt. This extra step is required because student loans aren't automatically discharged in bankruptcy like credit cards or medical bills often are.

To get a student loans discharge, you need to show the court two things:

• That repaying your loans causes you undue hardship

• That you’ve made a good faith effort to repay them in the past

💡 The adversary proceeding is how you formally make this request to the court.

In most student loan cases, this process starts with an attestation form. This form asks questions about your income, expenses, and loan history so the court can decide whether you qualify for a discharge.

This step comes after you file your bankruptcy case. It’s a separate part of the process focused just on your student loans. We’ll walk through how it works later, but for now, just know that if you want your student loans included in your bankruptcy discharge, you’ll need to go through this extra court process.

Do APs Work the Same for Federal Student Loans and Private Student Loans?

Unfortunately, no. The U.S. Department of Justice and U.S. Department of Education's guidance is specifically directed at federal student loan borrowers — federal Direct Loans or federal Direct Consolidation Loans, in particular.

If you have other types of federal student loans (Perkins, FFEL, etc.) or you have private student loans, you can still try to get your loans discharged in bankruptcy by filing an adversary proceeding, but success rates are lower and the process is typically more difficult

🔎 If your student loan debt doesn’t qualify for a bankruptcy discharge, you can still explore affordable repayment and forgiveness options with Upsolve’s partner, Student Debt Solutions (SDS). This self-service tool helps you understand your options and take the next step.

SDS is an affiliate partner, which means Upsolve may earn a small commission if you choose to use their paid service. This helps keep our services free.

Other Adversary Proceedings in Bankruptcy

Many Chapter 7 bankruptcies go smoothly and do not require an adversary proceeding.

But here are some reasons adversary proceedings are filed in bankruptcy cases:

• A creditor or lender objects to a specific debt being discharged

• There’s a general objection to granting the filer a discharge

• The trustee wants to recapture property from a third party

• A secured creditor needs to prove they have a valid lien on the filer’s property

This list isn’t exhaustive. If you’ve received notice that an adversary proceeding has been opened by the Bankruptcy Court, you may be in difficult legal territory. 

The AP will operate like a lawsuit, so you should consider speaking to a lawyer or reaching out to a local legal aid organization to get more information about what to expect. Some courts even have a panel of attorneys that will help filers pro bono (for free) in certain adversary proceedings.

What Happens During an Adversary Proceeding for Student Loans?

This section covers what happens during an AP for federal Direct and Direct Consolidation loans. If you have other types of federal loans or private loans, your AP will run more like what’s described in the section “What Happens During Adversary Proceedings That Aren’t for Federal Student Loans?”

Step 1: File an Adversary Complaint With the Bankruptcy Court

An adversary proceeding starts with an adversary complaint. A complaint is a legal document that lays out your case and names the parties involved in the proceeding.

📄 You’ll also need to submit a list of all your student loans. There’s an easy way to get this information: download it from the National Student Loan Data System (NSLDS). Here’s How To Get Your Federal Student Loan Info From the NSLDS.

If this sounds intimidating, don’t worry! Help is available. If you’re eligible to file your case with Upsolve, our nonprofit can help you with your complaint. And remember, in order to initiate an adversary proceeding, you must have already filed your bankruptcy case. If you need help doing that, read this popular article first: How To File Bankruptcy for Free.

Step 2: Serve the Complaint

The next step is to serve the complaint to the defendants you named — your federal student loan lender(s) — and other interested parties.

📬 To serve the complaint means to officially deliver (via mail or in person) a copy to the people or organizations you’re suing so they know about the case and have a chance to respond. The court requires you to serve the complaint to the defendant to make sure they are aware of the adversary proceeding. 

In most cases, student loan bankruptcy filers will send a complaint to:

• The U.S. attorney overseeing your bankruptcy filing district

• The attorney general of the U.S. Department of Justice

• The student loan servicer (i.e., the Department of Education)

• The U.S. trustee of your bankruptcy’s filing district

In federal student loan cases, you must also serve the Assistant United States Attorney (AUSA) with a summons and complaint.

Step 3: Fill Out an Attestation Form

As mentioned above, you must meet the undue hardship standard to be eligible for student loan discharge in bankruptcy. The AUSA and bankruptcy judge will determine whether you qualify for debt relief through bankruptcy. To make this determination, they will review the information you provide on the 15-page attestation form.

It’ll be easier to fill out the attestation form if you have a copy of your bankruptcy forms handy.

3️⃣ The goal of the attestation is to get a sense of your financial circumstances and see if you meet the three main eligibility criteria for discharge:

• You’re currently unable to make your student loan payments (based on your current income and living expenses) while maintaining a minimal standard of living for you and your dependents.

• You expect that this inability to repay your student loan debt will continue in the future (for the duration of the loan’s repayment period or longer) due to disability, chronic unemployment, or other serious adversity.

• You’ve shown a good faith attempt to make monthly payments on your education loans. This could include enrolling in an income-driven repayment plan, applying for deferment or forbearance, applying for student loan forgiveness programs, applying for loan consolidation, or more.

To learn more about the attestation form, read “Step 3: Complete the Attestation Form” from our article: Yes, You Can File Bankruptcy on Student Loans. Here’s How.

Step 4: The AUSA Reviews Your Form and Makes a Recommendation to the Bankruptcy Court

The Assistant United States Attorney (AUSA) will review your attestation form, any evidence you include, and your NSLDS report. Then the AUSA makes a recommendation to the bankruptcy judge. This is just a recommendation; it is not binding. 

The bankruptcy judge handling the case will ultimately decide if you qualify for an undue hardship discharge. The judge may or may not request that you show up for a hearing so they can ask you some questions. If there is a hearing, it’s likely to be held virtually. It’s important to attend so you can answer the judge’s questions.

Extensions and Continuances

It's common for the AUSA to ask the court for more time to review your case. In some cases they may request a continuance of 30, 60 or up to 90 days.

Step 5: The Bankruptcy Judge Issues a Decision

As mentioned, the bankruptcy judge overseeing your case has the final say in whether or not to discharge your federal student loan debt as part of your bankruptcy case. The judge may decide to allow a complete discharge of your qualifying student loan debt. They could also issue a partial discharge. Finally, the judge could deny the discharge. 

What Happens During Adversary Proceedings That Aren’t for Federal Student Loans?

An adversary proceeding generally runs like a mini-trial. The person who files the proceeding is asking the court to decide something. They make their case first. Then, the other party has a chance to respond and make their own arguments.

In some cases, the parties may present evidence, usually in the form of documents or witnesses, while others are resolved before reaching that point.

Because there are so many different types of adversary proceedings, it is impossible to provide a full description of what to expect. However, if you hire an attorney to represent you in the adversary proceeding, the lawyer will be able to explain in more detail how that particular type of case will move forward. 

Each adversary proceeding may look a little different, but here’s a general overview of how they work when they aren’t used to discharge federal student loans.

Step 1: Complaint

Go to court to open an adversary proceeding and file a complaint. 

Step 2: Summons

The clerk issues a summons either on the day that you file your complaint or within a few days. Once issued, you have 30 days to serve the summons and complaint.

Step 3: Response

The summons is served and the defendant has 30–35 days to respond by filing either an answer or a motion to dismiss.

• If they don’t do either and there’s no response, you can file a motion for default asking the court to approve your request and grant a judgment against the defendant by default. 

• If the defendant responds with a motion to dismiss, you’ll be given a chance to file a response to the motion and make your case to the judge at a hearing on the motion. If the court rules in your favor, the defendant will file an answer.

• If they respond by filing an answer, the case moves forward to the discovery period. 

Step 4: Discovery

During this time you exchange information with the defendant as you both prepare for trial. This also provides more time to reach a settlement with the other side. 

Step 5: Pretrial Proceedings

If no settlement is reached, the matter will eventually be set for trial. 

Step 6: Trial 

At trial, both sides can present evidence and question witnesses. The judge will review everything and issue a decision. In cases involving things like fraud, dischargeability of certain debts, or other disputes, the court's decision will resolve the issue raised in the complaint.

Step 7 (if applicable): Appeal 

The losing party may appeal to the District Court or the Bankruptcy Appellate Panel (if any).  Not every case is eligible for appeal, and strict deadlines apply. If you're considering an appeal, it's often helpful to speak with an attorney who handles bankruptcy appeals.