Law Firm Secures Full Student Loan Discharge in Landmark Case Highlighting New Federal Guidelines

A federal court has granted a comprehensive student loan discharge for Teodor Feher, marking a significant milestone in student debt resolution and signaling a potential shift in how courts and federal agencies approach educational loan bankruptcies.

The case, filed under case number 24-10686-SMG and Adv. No. 24-01334-SMG, involved Feher's federal student loans accumulated while pursuing academic degrees from New York University and the University of Oxford. Following a personal and professional crisis that triggered a chronic illness, Feher's loans had fallen into default, creating a complex legal challenge.

Attorney Chad Van Horn strategically leveraged newly revised federal guidelines from the Department of Justice and Department of Education, which provide a more compassionate framework for evaluating student loan discharge petitions. These guidelines now require demonstrating three key criteria: a present inability to repay, a likelihood that this financial incapacity will persist, and evidence of good-faith efforts to engage with loan servicers.

Under the new approach, borrowers can submit a standardized attestation form with supporting documentation, allowing government attorneys to more readily stipulate to undue hardship claims. In Feher's case, this approach resulted in a complete discharge of his $35,313 federal student loan debt through an Agreed Final Judgment entered on March 13, 2025.

The successful resolution represents more than an individual victory; it potentially signals a broader transformation in student loan bankruptcy proceedings. By adopting a more nuanced and empathetic evaluation process, federal agencies are acknowledging the complex financial challenges faced by many student loan borrowers struggling with debt.

This case underscores the importance of specialized legal representation in navigating the intricate landscape of student loan discharges. Borrowers facing seemingly insurmountable educational debt may now have increased opportunities for meaningful financial relief through strategic legal approaches aligned with evolving federal guidelines.