Non-dischargeable Items In A Bankruptcy

Hot Springs, AR Chapter 7 bankruptcy lawyer Steve Westerfield has represented clients

before 40 of the 75 Circuit Courts located within the State of Arkansas, before the Federal District Court in both the Eastern and Western District of Arkansas, and before the Federal Bankruptcy Court in both the Eastern and Western District of Arkansas. Here, he explains what debts you cannot discharge in a bankruptcy, and why.

For people who are considering filing bankruptcy, its important to get the right legal advice and learn which debts are dischargeable and which debts are not.

Dischargeable Debts

Bankruptcy will not discharge a duty to pay alimony or child support. In most cases, it will also not discharge student loans. Student loans, as far back as the 1960s and 1970s, were usually dischargeable. However, the default rate became so large that Congress specifically changed the law to prevent a borrower from discharging a government guaranteed student loan in bankruptcy.

In some cases, it will discharge tax obligations; however, taxes are most often not dischargeable, depending on whether proper returns have been filed and depending on the age of the tax debt. And debts you incur to pay off other dischargeable debts will not be discharged. In other words, you cannot take out a large cash advance on your credit card to pay off a student loan, and then hope for that new debt will be discharged it wont.

A bankruptcy will not discharge a debt caused by intentional wrongful acts, and it will not discharge debt which results from fraud on the part of the debtor. It will not discharge a debt caused as the result of a vehicle collision if the debtor was driving while intoxicated. Finally, its also important to keep in mind that all debts you did not list on your bankruptcy petition will not be discharged.

Helpful Advice

As a bankruptcy lawyer based in Hot Springs, AR, I advise my clients to look into dischargeable debts. If you discover that youre not a good candidate for Chapter 7 bankruptcy, then you may wish to consider filing Chapter 13, which is a repayment plan. To qualify, you must have sufficient income to pay off most of your debts over a period of three to five years, and your debt cannot exceed specific limits that are set out in the Bankruptcy Code.

Remember, certain debts and obligations cannot be discharged in a Chapter 7 bankruptcy, and a good bankruptcy lawyer will advise you of this from the very beginning. Contact your bankruptcy lawyer if you are considering filing Chapter 7 or Chapter 13. You deserve a fresh start, and to get on the path to financial freedom as soon as possible.

This article is for informational purposes only. You should not rely on this article as a legal opinion on any specific facts or circumstances, and you should not act upon this information without seeking professional counsel. Publication of this article and your receipt of this article does not create an attorney-client relationship.

by: Steve Westerfield

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