Bankruptcy is an exceptionally useful tool for those looking to permanently get rid of their debts. However, while the most notable benefit of bankruptcy is the ability to discharge debt, there are rules covering which debts can be discharged by each chapter. Below, our California debt relief team tells you everything you need to know about which debts are dischargeable.
Dischargeable Debts Under Chapter 7
Chapter 7 bankruptcies take an average of four to six months to complete, and the filer will gain their discharge 60 days after the Metting of Creditors at the end of the process. Once the discharge is received, the filer is no longer responsible for paying the forgiven debt, and creditors are unable to further pursue repayment.
Here is a list of debts that are dischargeable by Chapter 7:
- Credit card debt
- Medical bills
- Personal loans
- Utility bills
- Business debts
- Obligations under contracts and leases (ex. past due rent)
Dischargeable Debts Under Chapter 13
While the primary goal of Chapter 13 bankruptcies is not necessarily to get rid of debt through a discharge, filers are often granted them. There are debts that Chapter 13 can discharge that are unavailable to Chapter 7 filers, however, there are cases in which a filer may be asked to covert their case to a Chapter 7 to best suit their financial circumstances.
Discharges under Chapter 13 can include:
- Court fees
- Marital debts from divorce (excluding alimony and child support)
- Retirement plan loan debts
- Debts that we not discharged in a previous bankruptcy
- Condo, HOA, and co-op fees
Several debts can be discharged by bankruptcy, but it is important to understand that certain debts cannot be eliminated by the bankruptcy process. These include:
- Child support
- Criminal restitutions
- Certain taxes
- Debts from fraud
Student loans are also an example of a type of debt that is typically considered nondischargeable, but it can be successfully argued for elimination under certain circumstances.
Contact Our Seasoned Bankruptcy Team Today
Taking on large amounts of debt is a stressful and overwhelming ordeal. At The Sexton Law Firm, we are committed to finding creative and cost-effective solutions to your debt problems and help you find the financial freedom you deserve.
If you would like to learn more about how we can help you get rid of debt, contact us today through our website or give us a call at (619) 202-8976 to schedule your consultation today!