Information about Dischargeable Debt in Bankruptcy
If you are wondering what debts can be discharged under a Chapter 7 bankruptcy, you are not alone. There is a great deal of confusion about bankruptcy, especially since bankruptcy reform was enacted in 2005. The good news: filing bankruptcy is still an excellent choice for people overwhelmed by debt, because they can discharge most of their debts and start again.
At the Leventhal Law Group, P.C., in Woodland Hills, California, I assist people with Chapter 7 bankruptcy filings. This means that I answer their questions about the process, help them complete required paperwork, and represent them during 341 hearings with creditors. I am often asked about the debts that may be discharged in a Chapter 7 bankruptcy.
Call a Los Angeles-area attorney at the Leventhal Law Group, P.C. at 818-456-0397 for a free initial consultation.
Exceptions to a Discharge of Debt
Because almost all debts can be discharged in a Chapter 7 bankruptcy, it's easier to list the exceptions to the rule. The following is a list of debts that usually cannot be discharged:
- Certain types of unpaid taxes and fines
- Child support and alimony arrearages
- Criminal penalties, including fines and restitution
- Personal injury settlements, including DWI accident debts
- Government-funded or guaranteed student loan payments
- Debts to condo or co-op housing fees
- Debts to specific types of tax-advantaged retirement plans
A few of these may be dischargeable in a Chapter 13 bankruptcy (unlike a Chapter 7), including, debts arising from delinquent tax payments, criminal penalties, and debts related to a property settlement in divorce.
What Can Be Discharged?
Generally speaking, all other debts can be discharged. Credit card debt, personal loans, medical bills, car accident claims, leases, business debts, judgments, and some old taxes and tax penalties are dischargeable. Secured debts, such as a car loan or a home mortgage, are often settled by repossession of the asset or foreclosure on the house; the remainder of the debt is usually discharged. In some cases, debts may be settled via negotiation with creditors instead of discharged through bankruptcy.
Contact the Leventhal Law Group, P.C.. Call my Los Angeles-area office at 818-456-0397 to speak with a lawyer about debts that can be discharged through bankruptcy.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.
