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Founder, CFP®

UPDATED: May 29, 2012

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A federal bankruptcy judge ruled in favor of discharging a debtor with Asperger’s Syndrome’s student loan debt, according to the Baltimore Sun.

Carol Todd, a 63-year-old woman from Baltimore County, pursued multiple college degrees “as a stepping stone toward a measure of liberation… and perhaps to help her achieve something closer to a normal life,” said Judge Robert A. Gordon, the bankruptcy judge who ruled in favor of discharging Todd’s student loan debt.

Todd pursued an associate’s degree from Villa Julie College, a bachelor’s degree from the Notre Dame of Maryland University, and two master’s degrees from Towson University. As a result, she racked up a bill totaling $340,000.

Such an astounding amount of debt, however, complicated Todd’s life even further, said Gordon. As a result, he made a rare judicial decision and discharged her debt based on “undue hardship.”

Discharging Student Loan Debt

This ruling offered a glimpse of hope to those looking at the nation’s bankruptcy rulings, as student loan debt has a reputation for being notoriously hard to have discharged.

“It’s very difficult to discharge a student loan,” explained Lawrence D. Coppel, a Baltimore attorney and founder of Maryland’s Bankruptcy Bar Association, to the Baltimore Sun.

While auto loans, mortgages, and credit card debt can all be discharged through bankruptcy, student loans are one of the few types of debt that stay with most people even through a bankruptcy filing. In fact, the only way for borrowers to relieve themselves of student loans is by proving the monthly payments create an “undue hardship.”

But personal stories have shown that the borrowers’ definitions of “undue hardship” and judges’ definitions of “undue hardship” tend to vary wildly.

For instance, Renee Marie French petitioned that her student loans were causing undue hardship after her debt rose from $14,000 to $44,000 due to interest and late fees alone. Additionally, her mother and stepfather both passed away, and French was earning $20 an hour while supporting both herself and a child.

“I pay $1,000 in child care, so I don’t make enough to pay for my bills,” she told USA Today. “I pay $25 a month to the collection agency.”

Despite her plea, a judge ruled against French’s petition.

According to USA Today, undue hardship claims are successful only 50 percent of the time… at best.

A Unique Decision

“Most of the decisions that are published deby the discharge and refuse to find a hardship exception, even in cases where there’s clearly hardship, said Coppel. “So the decision by Judge Gordon… is unique.”

But his unique decision will not apply to all student loan borrowers with Asperger’s syndrome.

“The thing to understand about Asperger’s is that it can impact people so differently,” said Barbara A. Bissonnette, a workplace coach for people with Aperger’s syndrome, to the Baltimore Sun.

She said that some people with the autistic-like disorder can earn six-figures in the work place. Others, however, can have difficulty finding even a minimum-wage job.

“Lately I’ve been seeing in my coaching practice many more young people, because there’s so much more awareness now and Asperger’s is diagnosed at a much younger age,” Bissonnette said.

When those with Asperger’s are diagnosed at an early age, they can receive the proper treatment and care needed to graduate from high school and even pursue higher education. But Bissonnette said that higher education degrees do not remove the social difficulties that those with Asperger’s face.

Those difficulties often prevent them from operating in the workforce, which results in undue hardship when trying to repay student loan bills.