What can you Discharge in a Bankruptcy?

Date: Oct 05 2018

It really depends on which type of bankruptcy you plan to file. As an individual, you would likely file a Chapter 7 or Chapter 13 Bankruptcy and for a better understanding of what kind of debt can be discharged we must review these two types of bankruptcies. Visit us at www.santoslawpa.com to keep reading.

Chapter 7 vs. Chapter 13: What’s the difference? Both type of bankruptcies will help release you from debt but in different ways. In a Chapter 7 Bankruptcy,

  • Your nonexempt assets are liquidated, funds recovered distributed to your creditors
  • Creditors cannot call you to collect once your qualifying debts are discharge

In a Chapter 13 Bankruptcy,

  • You will be in a repayment plan for 3 to 5 years
  • After the repayment plan your qualifying debts will likely be discharged

Some of the debts that qualify for discharge under both types of bankruptcies include:

  • Credit card debt
  • Medical Bills
  • Unpaid Rent
  • Unpaid utility Bills
  • Unpaid Mortgages
  • Unpaid Auto Loans
  • Unpaid Personal Loans

Almost all unsecured debt is dischargeable (like credit card). Secured debts (like mortgages, auto loans) can be discharged but the creditor will be entitled to take back the property (home or car). There are certain (limited) instances when HOA dues, Taxes, and even Student Loans can be discharged though they typically don’t qualify.

If you’re struggling to pay your debts, or if you are already in default, or if you have received a lawsuit for failure to pay debts you may qualify for Bankruptcy. Contact The Santos Law Offices, PA to discuss your options. Call 305-417-4111 for a free consultation.

This information is provided for educational or informational purposes only and should not be construed as legal advice. The information is not provided in the course of an attorney-client relationship and is not intended to substitute for legal advice.