                FOR PUBLICATION
 UNITED STATES COURT OF APPEALS
      FOR THE NINTH CIRCUIT

In re: LORNA KAYE NYS,             
                         Debtor,
                                         No. 04-16007
EDUCATIONAL CREDIT MANAGEMENT              BAP No.
CORPORATION,                            NC-03-01438-
                      Appellant,           MaMcP
              v.                          OPINION
LORNA KAYE NYS,
                       Appellee.
                                   
              Appeal from the Ninth Circuit
               Bankruptcy Appellate Panel
    Perris, McManus, and Marlar, Bankruptcy Judges,
                        Presiding

                 Argued and Submitted
      February 15, 2006—San Francisco, California

                  Filed April 26, 2006

     Before: Stephen Reinhardt, Richard A. Paez, and
           Richard C. Tallman, Circuit Judges.

               Opinion by Judge Tallman




                          4763
4766                      IN RE: NYS


                         COUNSEL

Miriam Hiser, San Francisco, California; Curtis P. Zaun, Edu-
cational Credit Management Corporation, St. Paul, Minne-
sota, for the appellant.

Christopher G. Metzger, Eureka, California, for the appellee.


                         OPINION

TALLMAN, Circuit Judge:

   Debtor-Appellee Lorna Kaye Nys (“Nys”) filed an adver-
sary complaint in bankruptcy court to have her student loans
discharged under 11 U.S.C. § 523(a)(8). The trial court found
from the evidence that Nys’s current income is “not nearly
enough to pay off her student loans,” and that it “is the most
she can reasonably be expected to earn in the foreseeable
                                 IN RE: NYS                               4767
future.” The bankruptcy court nonetheless ruled against Nys,
concluding that “undue hardship” requires the showing of an
“exceptional circumstance” beyond the mere inability to pay.

   Nys appealed to the Bankruptcy Appellate Panel (“BAP”).
In a published decision, Nys v. Educ. Credit Mgmt. Corp. (In
re Nys), 308 B.R. 436 (B.A.P. 9th Cir. 2004), the BAP
reversed and remanded, directing the bankruptcy court to
reevaluate Nys’s claim using the correct legal standard. The
BAP reasoned that the three-prong test we adopted in United
Student Aid Funds, Inc. v. Pena (In re Pena), 155 F.3d 1108
(9th Cir. 1998),1 for determining whether the repayment of
student loans would impose an “undue hardship” on the
debtor or her dependents requires the debtor to show “addi-
tional circumstances” that prove that her inability to pay in the
present will likely persist for a significant portion of the
loan’s repayment period. Nys, 308 B.R. at 444. We affirm the
BAP. “Undue hardship” does not require an exceptional cir-
cumstance beyond the inability to pay now and for a substan-
tial portion of the loan’s repayment period.

                                       I

  Nys filed a Chapter 7 bankruptcy petition in the Northern
District of California on June 12, 2002.2 Shortly thereafter,
she filed an adversary complaint against Educational Credit
  1
     In Pena, we adopted the three-prong test set forth by the Second Cir-
cuit in Brunner v. New York State Higher Education Services Corp., 831
F.2d 395 (2d Cir. 1987) (per curiam). Under this test, the debtor must
show: “(1) that the debtor cannot maintain, based on current income and
expenses, a ‘minimal’ standard of living for herself and her dependents if
forced to repay the loans; (2) that additional circumstances exist indicating
that this state of affairs is likely to persist for a significant portion of the
repayment period of the student loans; and (3) that the debtor has made
good faith efforts to repay the loans.” Id. at 396. Hereinafter, we will refer
to this test as the Brunner test.
   2
     We extract most of the facts from the BAP’s published opinion, con-
firmed by our own independent review of the record.
4768                          IN RE: NYS
Management Corporation (“ECMC”), the holder of her feder-
ally guaranteed student loans, to have those loans fully dis-
charged under 11 U.S.C. § 523(a)(8).3

   Between 1988 and 1992, Nys took out thirteen separate stu-
dent loans to finance an Associate of Arts Degree in Science
and Drafting Technology from the College of the Redwoods
and a Bachelor of Arts Degree from Humboldt State Univer-
sity. In 1996, Nys began working at Humboldt State Univer-
sity as a drafting technician. She is employed as a Drafter II,
the highest drafter position available at Humboldt State. In
2002, Nys’s net gross income was $40,244. Because she pays
$140 per month to her retirement plan, her 2002 W-2 shows
an adjusted gross income of $36,981.74. The bankruptcy
judge found that this income was about as high as one could
reasonably expect in Humboldt County given her profession
and educational background. The evidence also showed that
Nys lived in a modest home in Fortuna, California, which was
in need of extensive repairs. At the time of trial, Nys was 51
years old. She plans to retire at age 65, and at that time her
income will drop considerably.

   Nys borrowed approximately $30,000 through student
loans. At the time of trial, she owed approximately $85,000
in accumulated principal and interest. Nys’s net monthly
income was $2,299.33. She claimed $2,295.05 in monthly
expenses.

   Because she was granted deferments, Nys made no pay-
ments on her student loans until August 2001, when she
received a wage garnishment notice from ECMC’s
  3
   In relevant part, § 523(a)(8) provides that a Chapter 7 discharge does
not discharge an individual debtor from any debt “unless excepting such
debt from discharge . . . would impose an undue hardship on the debtor
and the debtor’s dependents, for . . . an educational benefit overpayment
or loan made, insured, or guaranteed by a governmental unit, or made
under any program funded in whole or in part by a governmental unit or
nonprofit institution.” 11 U.S.C. § 523(a)(8) (emphasis added).
                                IN RE: NYS                              4769
predecessor-in-interest. To avoid garnishment, Nys paid $130
per month on her student loans. She made those payments
until May 2002, when ECMC notified her that her monthly
payments would increase to $917.56.

   At that time, Nys contacted the William D. Ford Loan Pro-
gram (“Ford”), see 34 C.F.R. § 685.100, in an attempt to
establish an affordable payment plan. The parties dispute
what type of payment plan Ford offered Nys. Nys claims that
Ford informed her that her monthly payments would still be
between $800 and $900, and that she would need to pay an
initial assessment fee of almost $14,000. ECMC argues that
Nys is eligible for an Income Contingency Repayment Plan4
and that under this program her monthly payment would be
between $389 and $453.5

   During the trial, Nys argued that she is still unable to make
payments on her student loans, and that because of additional
circumstances, her inability to pay will continue into the fore-
seeable future. Her “additional circumstances” were that (1)
she is 51 years old (14 years from legal retirement age), (2)
she has “maxed out” in her career and her income is as high
as it is ever going to be, (3) her house is in need of substantial
repairs, and (4) she commutes daily at some distance in an old
automobile with high mileage that will soon need to be
replaced.

  The bankruptcy court ruled for ECMC, finding that Nys
had not proved “undue hardship.” Although it concluded that
“Nys is clearly incapable of repaying more than a portion of
  4
     Nys claimed that she was never offered an Income Contingency
Repayment Plan. The trial court did not resolve this discrepancy given its
disposition of the case.
   5
     At the time of the trial, Nys was still able to claim one of her children
as a dependent. As a result, ECMC argued that her payments under the
Ford Program would have been $389 per month. Now, if she can no lon-
ger claim any dependents, ECMC acknowledges that her monthly payment
would be approximately $453.
4770                       IN RE: NYS
her student loans and this situation will almost certainly per-
sist for the foreseeable future,” it found no undue hardship
because “[Nys] ha[d] demonstrated no additional circum-
stances beyond the mere inability to pay.” The bankruptcy
court rejected Nys’s argument that “undue hardship exists any
time the debtor cannot afford to pay the loans now or in the
foreseeable future.” It found that “[e]xceptional circumstances
must be shown to meet the second prong of the Brunner test.”

   The BAP reversed the bankruptcy court because it con-
cluded that the bankruptcy court had applied the wrong legal
standard when addressing the second prong of the Brunner
test. As the BAP characterized the test, “[a]dditional circum-
stances are any circumstances, beyond the mere current
inability to pay, that show that the inability to pay is likely to
persist for a significant portion of the repayment period.” Nys,
308 B.R. at 444. Because the bankruptcy court required the
additional circumstances to be exceptional, the BAP reversed
and remanded for an application of the correct “additional cir-
cumstances” test.

                                II

   The bankruptcy court had jurisdiction under 28 U.S.C.
§ 157(b), the BAP had jurisdiction under 28 U.S.C. § 158(b),
and we have jurisdiction under 28 U.S.C. § 158(d). We inde-
pendently review the bankruptcy court’s decision. Rifino v.
United States (In re Rifino), 245 F.3d 1083, 1086 (9th Cir.
2001). The bankruptcy court’s findings of fact are reviewed
for clear error and its application of the legal standard is
reviewed de novo. Id. at 1086-87.

                               III

  [1] The issue we must decide is whether “undue hardship”
requires an additional or exceptional circumstance beyond an
impervious financial situation that will continue to impede the
debtor’s ability to make payments on her student loans and
                           IN RE: NYS                           4771
maintain a minimal standard of living. Section 523(a)(8) pro-
vides that a student loan is not dischargeable “unless except-
ing such debt from discharge . . . would impose an undue
hardship on the debtor and the debtor’s dependents.” 11
U.S.C. § 523(a)(8). “Undue hardship” is not defined in the
Bankruptcy Code; however, we and a majority of the other
circuits have expressly adopted the Brunner test. See supra
note 1.

   When it adopted the Brunner test, the Second Circuit
explicitly incorporated the reasoning of the district court in
toto. Brunner, 831 F.2d at 396. The district court had
throughly analyzed the limited legislative history pertaining to
the “undue hardship” requirement, Brunner v. N.Y. State
Higher Educ. Servs. Corp. (In re Brunner), 46 B.R. 752, 753-
55 (Bankr. S.D.N.Y. 1985), and therefore, because the legisla-
tive history was influential in the development of the Brunner
test, we will discuss it again here.

   Congress provided little in the way of express legislative
intent specifically addressing the “undue hardship” require-
ment when it passed the statute. Id. at 753. Nonetheless, the
phrase “undue hardship” was lifted verbatim from a bill pro-
posed by the Commission on the Bankruptcy Laws of the
United States (“Commission”), and with no clear indication to
the contrary, we may impute the Commission’s intent to Con-
gress. Id. at 754; see also McClendon v. Cal-Wood Door (In
re Wadsorth Bldg. Components, Inc.), 711 F.2d 122, 124 (9th
Cir. 1983) (looking to the Commission’s report to interpret
congressional intent). The Commission recognized that there
was a high incidence of students filing for bankruptcy after
finishing their education. Brunner, 46 B.R. at 754.

    This “rising incidence” contravened the general pol-
    icy that “a loan . . . that enables a person to earn sub-
    stantially greater income over his working life
    should not as a matter of policy be dischargeable
    before he has demonstrated that for any reason he is
4772                      IN RE: NYS
    unable to earn sufficient income to maintain himself
    and his dependents and to repay the educational
    debt.”

Id. (quoting Report of the Comm’n on the Bankr. Laws of the
United States, H.R. Doc. No. 93-137, at 140 n.15 (1973)
[hereinafter Report of the Comm’n] (alteration in original)).
By requiring a showing of undue hardship,

    the Commission envisioned a determination of
    whether the amount and reliability of income and
    other wealth which the debtor could reasonably be
    expected to receive in the future could maintain the
    debtor and his or her dependents at a minimal stan-
    dard of living as well as pay off the student loans.

Id. (citing Report of the Comm’n, H.R. Doc. No. 93-137, at
140-41 n.17).

   Therefore, Congress sought to prohibit a “garden-variety
debtor” from discharging student loans, especially when that
“garden-variety debtor” will presumably use her loan-funded
education to substantially increase her income in the near
future. See Rifino, 245 F.3d at 1087 (“ ‘Congress viewed
garden-variety hardship as [an] insufficient excuse for a dis-
charge of student loans . . . .’ ” (quoting Pena, 155 F.3d at
1111) (second alteration in original)). What separates a
“garden-variety debtor” from a debtor who can show “undue
hardship” is the realistic possibility that a “garden-variety
debtor” could improve her financial situation in the future.
With increased financial stability, a debtor can make pay-
ments on her student loans and maintain a minimal standard
of living. In comparison, forcing debtors who cannot reason-
ably be expected to increase their future income to make pay-
ments on their student loans when it causes them to fall below
a minimal standard of living constitutes an “undue hardship.”
                                IN RE: NYS                            4773
   [2] Consequently, in an effort to comply with congressional
intent and to provide some guidance for the lower courts that
are primarily responsible for administering the “undue hard-
ship” standard, the Second Circuit adopted the three-prong
test formulated by the district court. See Brunner, 831 F.3d at
396. The dispositive issue in this appeal is what is meant by
the phrase “additional circumstances” as it is used in the sec-
ond prong. ECMC argues that the “[m]ere inability to repay
one’s student loans in the future has never been the test for
determining undue hardship.” ECMC contends that “Pena and
Brunner require a debtor to show not just future inability to
repay, but that ‘additional circumstances’ preclude future
repayment.” In other words, ECMC contends that “undue
hardship” requires the debtor to show (1) the inability to pay
now and in the foreseeable future and (2) some additional or
exceptional circumstance beyond the mere inability to repay.
ECMC misinterprets our case law and the purpose of the “ad-
ditional circumstances” language in the Brunner test.6

  [3] To be eligible for a discharge of student loans, the
debtor must prove that her present inability to pay will likely
  6
    Under the test as proposed by ECMC, any decision within the debtor’s
control could not qualify as an “additional circumstance.” Therefore, a
person who has chosen to go into a certain field and who, despite her best
efforts, has topped out in her career with no possibility of future advance-
ment cannot obtain a discharge of her student loans. ECMC argues that the
debtor must either uproot her family and move, or switch careers to try to
obtain a higher paying job. Because a college education is expensive no
matter what field a student chooses, we cannot say that a debtor who, in
good faith, chooses a certain field but ultimately cannot increase her
income to a point that allows her to repay her student loans, is foreclosed
from seeking a discharge. Furthermore, courts have recognized that a lack
of useable job skills may constitute “additional circumstances.” Pa.
Higher Educ. Assistance Agency v. Birrane (In re Birrane), 287 B.R. 490,
497 (B.A.P. 9th Cir. 2002). Clearly, a student makes a choice as to which
skills she will pursue during her education. We cannot fault a debtor for
making such a choice when, later on, it turns out that despite her best
efforts her skills are simply not sufficient to allow her to earn adequate
sums to repay accumulated principal and interest.
4774                        IN RE: NYS
persist throughout a substantial portion of the loan’s repay-
ment period. See Pena, 155 F.3d at 1114 (finding that the
debtors satisfied the Brunner test in part because “their unfor-
tunate financial situation was likely to continue for a substan-
tial portion of the repayment period”). The focus of this
inquiry is the debtor’s financial situation.

   [4] We recognize that courts have found it difficult to pre-
dict future income. Consequently, courts have required debt-
ors to present “additional circumstances” to prove that their
present financial situation will persist well into the future, pre-
venting them from making payments throughout a substantial
portion of the loans’ repayment period. See, e.g., Brunner,
831 F.2d at 396 (“Predicting future income is . . . problematic.
Requiring evidence not only of current inability to pay but
also of additional, exceptional circumstances, strongly sug-
gestive of continuing inability to repay over an extended
period of time, more reliably guarantees that the hardship
presented is ‘undue.’ ”). These “additional circumstances” are
meant to be objective factors that courts can consider when
trying to predict the debtor’s future income; the debtor does
not have a separate burden to prove “additional circum-
stances,” beyond the inability to pay presently or in the future,
which would justify the complete or partial discharge of her
student loans.

   In support of its contrary position, ECMC cites the Sixth
Circuit’s decision in Cheesman v. Tennessee Student Assis-
tance Corp. (In re Cheesman), 25 F.3d 356 (6th Cir. 1994).
In Cheesman, although the Sixth Circuit discussed Brunner,
it did not expressly adopt Brunner’s three-prong test. Id. at
359. Rather, it found that the debtor’s “loans were discharge-
able under any undue hardship test the [trial] court may have
used.” Id. In reaching that conclusion, the Sixth Circuit stated
that “there is no indication that the Cheesmans’ financial situ-
ation will improve in the foreseeable future.” Id. at 360.

  ECMC argues that Cheesman presents an easier test
because the debtor is only required to show a future inability
                                IN RE: NYS                            4775
to pay, and that we explicitly rejected such a standard when
we adopted the Brunner test in Pena. Therefore, ECMC con-
tends that future inability to pay has never been the standard
for proving “undue hardship” in the Ninth Circuit. We dis-
agree.

   [5] In Pena, although we recognized the semantical differ-
ence in language employed between Cheesman and Brunner,
we concluded that “[i]t does not appear that the Sixth Circuit
in Cheesman was proclaiming a test distinct from Brunner.”
155 F.3d at 1112. Accordingly, we reject ECMC’s argument,
but will set forth here the manner in which Pena and Brunner
apply to a court’s effort to predict a debtor’s future income.
We do not presume that an individual’s present inability to
make loan payments will continue indefinitely. Rather, we
hold that the burden is on the debtor to provide the court with
additional circumstances, i.e., “circumstances, beyond the
mere current inability to pay, that show that the inability to
pay is likely to persist for a significant portion of the repay-
ment period. The circumstances need be ‘exceptional’ only in
the sense that they demonstrate insurmountable barriers to the
debtors’ financial recovery and ability to pay.” Nys, 308 B.R.
at 444.7 However, although the trial court should look to “ad-
ditional circumstances” to make this finding, the determina-
tive question is whether the debtor’s inability to pay will,
given all we know about the salient features of her existence,
persist throughout a substantial portion of the loan’s repay-
ment period.
  7
    By “additional circumstances” or “exceptional circumstances” we
mean only that the debtor must present something more than her current
financial situation. In other words, she cannot rely on the fact that if she
made payments now on her student loans, she would not be able to main-
tain a minimal standard of living. Rather, she must present the court with
circumstances that she cannot reasonably change. To prove “undue hard-
ship,” the circumstances must indicate that the debtor cannot reasonably
be expected to increase her income and make payments for a substantial
portion of the loan’s repayment period.
4776                       IN RE: NYS
   Under this standard, the debtor cannot purposely choose to
live a lifestyle that prevents her from repaying her student
loans. Thus, the debtor cannot have a reasonable opportunity
to improve her financial situation, yet choose not to do so. See
Rifino, 245 F.3d at 1089 (stating the bankruptcy court’s fac-
tual finding that the debtor’s financial situation was not likely
to improve was clearly erroneous because, after she gained
experience, the debtor would have opportunities to advance to
higher paying positions within her profession). At the same
time, we cannot fault the debtor for having made reasonable
choices that now inhibit her ability to substantially increase
her income in the future. See Brunner, 46 B.R. at 754 (relying
on the Commission’s report and its belief that the “undue
hardship” test looks at what the “debtor could reasonably be
expected to receive in the future”).

   [6] We agree with the BAP that neither Brunner nor Pena
imposes a requirement that additional circumstances be “ex-
ceptional” in the sense that the debtor must prove a “serious
illness, psychiatric problems, disability of a depend[e]nt, or
something which makes the debtor’s circumstances more
compelling than that of an ordinary person in debt.” Nys, 308
B.R. at 444 (internal quotation marks omitted). Undue hard-
ship requires only a showing that the debtor will not be able
to maintain a minimal standard of living now and in the future
if forced to repay her student loans. We will presume that the
debtor’s income will increase to a point where she can make
payments and maintain a minimal standard of living; how-
ever, the debtor may rebut that presumption with “additional
circumstances” indicating that her income cannot reasonably
be expected to increase and that her inability to make pay-
ments will likely persist throughout a substantial portion of
the loan’s repayment period.

   Bankruptcy courts may look to the unexhaustive list of “ad-
ditional circumstances” provided by the BAP in its published
decision. See Nys, 308 B.R. at 446-47. The factors a court
may consider include, but are not limited to:
                               IN RE: NYS                           4777
      [(1)] Serious mental or physical disability of the
      debtor or the debtor’s dependents which prevents
      employment or advancement; [(2)] The debtor’s
      obligations to care for dependents; [(3)] Lack of, or
      severely limited education; [(4)] Poor quality of edu-
      cation; [(5)] Lack of usable or marketable job skills;
      [(6)] Underemployment; [(7)] Maximized income
      potential in the chosen educational field, and no
      other more lucrative job skills; [(8)] Limited number
      of years remaining in [the debtor’s] work life to
      allow payment of the loan; [(9)] Age or other factors
      that prevent retraining or relocation as a means for
      payment of the loan; [(10)] Lack of assets, whether
      or not exempt, which could be used to pay the loan;
      [(11)] Potentially increasing expenses that outweigh
      any potential appreciation in the value of the debt-
      or’s assets and/or likely increases in the debtor’s
      income; [(12)] Lack of better financial options else-
      where.

Id. (citations and footnotes omitted).

                                   IV

   [7] The bankruptcy court erred in requiring Nys to show
exceptional circumstances beyond the inability to pay in the
present and a likely inability to pay in the future. We affirm
the BAP’s decision to reverse and remand the case back to the
bankruptcy court to allow it to apply the correct legal stan-
dard. The bankruptcy court should consider whether Nys has
shown that her inability to pay will likely persist throughout
a substantial portion of her loans’ repayment period. We
express no opinion as to whether Nys has established entitle-
ment to a partial or complete discharge. The bankruptcy court
must determine the merits of her claim by applying the correct
legal standard and all three Brunner prongs to the factual record.8
  8
  It may be that Nys is entitled to only a partial discharge due to the
amount of the debt and the unlikelihood that her income will increase sub-
4778                           IN RE: NYS
   On remand, the bankruptcy court must also determine
whether Nys has made a good faith effort to repay her student
loans, since all three prongs of the Brunner test must be met
before a court can make a finding of undue hardship. See
Rifino, 245 F.3d at 1087-88. This determination will require
the bankruptcy court to consider the evidence regarding the
Ford program, and whether Nys, in good faith, considered
consolidation options. See Alderete v. Educ. Credit Mgmt.
Corp. (In re Alderete), 412 F.3d 1200, 1206 (10th Cir. 2005)
(agreeing that “[although] participation in a repayment pro-
gram is not required to satisfy the good-faith prong” it is con-
sidered “an important indicator of good faith” (internal
quotation marks omitted)).

  The decision of the Bankruptcy Appellate Panel is
AFFIRMED.




stantially between now and her retirement. Nys conceded that she has the
ability to pay a portion of the debt. Therefore, on remand, the bankruptcy
court should consider whether Nys is entitled to only a partial discharge.
See Saxman v. Educ. Credit Mgmt. Corp. (In re Saxman), 325 F.3d 1168,
1175 (9th Cir. 2003) (holding that before a bankruptcy court can use its
equitable powers under 11 U.S.C. § 105(a) to partially discharge a student
loan, it must find undue hardship).
