When you file Chapter 7, 11, 12 or 13 bankruptcy, one of the many terms you will encounter during the process is that of dischargeable debts. Our law firm will help you with these debts and provide you with an understanding of the differences between dischargeable and non-dischargeable debts. The following will provide and in-depth look at all there is to know about dischargeable debts and how they can help you through the bankruptcy process.
What Are Dischargeable Debts?
In essence, dischargeable debts involve certain types of debts that are owed by the person filing for bankruptcy. When this person files bankruptcy, a discharge will completely release the debtor from any continued liability for specific debts that are owed. However, this doesn’t apply to all debts. This isn’t merely a stop-gap or reduction of the debt that is owed. Any debts that qualify as being dischargeable will no longer have to be payed and will be erased from the record of having been owed by the debtor. The order for these discharges will be provided to all creditors for the debts that apply, which means that they no longer have the ability to take any type of collection action on the debtor.
These extend to personal letters and telephone calls, ensuring that the creditor never disturbs the debtor and tries to get them to pay even after the debt has been discharged. While the debtor will not be liable for any debts that fall under discharged debts, there is a possibility that a valid lien that has been placed on personal property of the debtor as a means of securing payment from the owed debt will still remain open even after the bankruptcy case has ended. If a lien remains, a second creditor might be able to claim the lien. However, this can be made unenforceable during bankruptcy, which is why it’s important for our NYC bankruptcy law firm to be there with you to ensure that you don’t get hit with any of these charges.
Difference Between Dischargeable and Non-Dischargeable Debts
When filing a bankruptcy, you will find there are many different types of debt that can be discharged, providing you with the means of starting over. However, there are certain debts that are considered to be non-dischargeable. While this might not be ideal, it provides you with the means of only paying off the few debts that may qualify as non-dischargeable, while erasing the other debts you were being weighed down with. When looking at dischargeable and non-dischargeable debts, some of the primary dischargeable ones include credit card debts, uninsured loans, medical bills, collections, payday loans, unpaid rent, utility bills, judgments and individual tax debts over three years ago. Mortgages and auto loan debts also fall under discharged debts. However, you will lose your car and your home if you file these under discharged debts.
As for non-dischargeable debts, this all depends on which type of bankruptcy you file. If you file for Chapter 7 bankruptcy, some of the main debts that aren’t able to be discharged include any taxes due within the last three years, alimony, child support, student loans and condominium fees. Debts obtained by fraud, unscheduled debts, debts due to embezzlement, debts for willful injury, debts for fines and debts due to personal injury or wrongful death lawsuits also fall under non-dischargeable debts with Chapter 7 bankruptcy. When it comes to Chapter 13 bankruptcy, the debts that cannot be discharged include interest owed on any non-dischargeable debts, specific taxes, student loans, alimony, child support, fines, unscheduled debts and debts caused by fraud. All debts from larceny, malicious injury, personal injury and wrongful death lawsuits, debts that built up after filing for bankruptcy and debts that aren’t dischargeable under other laws will be classified as non-dischargeable as well.
How Our Law Firm Helps With These Debts
Bankruptcy is oftentimes a lengthy and arduous process. However, this can all be avoided by seeking our NYC bankruptcy law firm to help you through this process. Once you file for bankruptcy, we will be there through every step of the way to ensure that every aspect of the bankruptcy progresses as it should and doesn’t hit any snags. When it comes to dischargeable and non-dischargeable debts, we will help you to file the necessary paperwork that will ensure you are able to erase every debt possible. Many people that attempt to do this without help tend to miss certain debts that can be listed under discharged debts. We want you to be able to start a new life after filing bankruptcy and the only way to make sure that this happens is through the help from our law firm. If you have any questions about our bankruptcy services, contact us at any time.