How Stretto Is Helping Bankruptcy Attorneys Erase Student Loans Faster
In this episode of the 720 System Strategies podcast, Igor Roitburg, senior managing director at Stretto, and I dig into the new DOJ guidance for student loan discharge in bankruptcy, why results have jumped, and how consumer firms can add a profitable, client-saving service right now. We also cover continuity under the current administration, what facts to screen for, realistic fees, and a simple workflow that gets you from intake to a filed adversary with confidence.
Frequently Asked Questions
- Why should bankruptcy attorneys revisit student loans now?
- Is the guidance still active under the current administration?
- What facts make a strong discharge case?
- How do I explain “what changed” to my team and clients?
- What fees are firms charging, and is there any court guidance?
- What quick tools help me screen and assemble the filing?
- What do I file, and in what order?
- Do I have a duty to bring this up with clients?
- How do I talk about results without overpromising?
- Where can I access the screening and document tools?
FAQ: Why should bankruptcy attorneys revisit student loans now?
Bankruptcy attorneys should revisit student loans because the process works. Since the DOJ and Department of Education released their guidance in 2022, reported outcomes through late 2024 show roughly 85% of cases receiving some discharge — about 70% full and 15% partial. That is a major shift from the near-zero success rate many remember from the past.
FAQ: Is the guidance still active under the current administration?
Yes. AUSAs are still proceeding, and the DOJ has updated both the attestation form and its public guidance page, signaling ongoing support. The framework traces back to a 2018 request for information about undue hardship, so it has roots that predate the 2022 rollout.
FAQ: What facts make a strong discharge case?
Strong cases show current inability to afford standard repayment, limited future earning capacity, a repayment history of roughly ten years or more, and any health issues affecting work. The affordability test now uses a standard repayment amount instead of IDR, which makes the math simpler and easier to meet. Older borrowers often meet the future-ability prong naturally.
FAQ: How do I explain “what changed” to my team and clients?
The statute itself did not change. The guidance organized existing law and case history into a clear, objective playbook that AUSAs now follow. This structure reduces guesswork, shortens analysis time, and improves consistency in case outcomes.
FAQ: What fees are firms charging, and is there any court guidance?
Reported fees range from about $2,500 to $7,500 depending on case complexity and local practice. The Northern District of California established a $4,500 no-look fee, which many attorneys use as a baseline when setting pricing.
FAQ: What quick tools help me screen and assemble the filing?
Stretto’s Discharge Snapshot is a free two-minute screener that flags likely candidates. The Discharge Analyzer costs $29 and produces a detailed assessment aligned with DOJ guidance. For $99, you can generate a prefilled attestation, draft adversary complaint, and a customized document checklist so your file is ready and complete.
FAQ: What do I file, and in what order?
Start with a quick screening to filter out weak cases. If viable, complete a full analysis, collect all supporting documents, and prepare the attestation package. File the adversary proceeding with the attestation and exhibits, then follow the playbook the guidance provides step by step.
FAQ: Do I have a duty to bring this up with clients?
Many professionals in the field believe you do. Student loans are often a client’s second-largest liability after a mortgage. At a minimum, raise the topic, explain the criteria, and offer a pathway to assess eligibility — even if your firm refers out the work.
FAQ: How do I talk about results without overpromising?
Share what current data shows and connect it to case facts. Emphasize that outcomes have improved because the process is clearer and more objective, but results still depend on affordability, future capacity, repayment history, and documentation quality. Transparency builds trust without overselling results.
FAQ: Where can I access the screening and document tools?
Go to dmmportal.com to log in and launch the Snapshot, Analyzer, and attestation package. Use the free Snapshot for triage, then upgrade for deeper analysis or to generate a ready-to-file packet when a case qualifies.