4 Things That Chapter 7 Bankruptcy Won'T Do
Posted on: 4 January 2016
If you're in a financial bind, you may think filing for Chapter 7 bankruptcy will get rid of all your problems. However, this is simply not the case. There are many debts that bankruptcy can get rid of, but there are several ones that won't be affected by it. It's ideal to know what debts won't be discharged when you do find out you're eligible for this status.
Eliminate student loans
When it comes to money you've borrowed to help pay for your education, this will typically have to be repaid regardless of if you qualify for bankruptcy or not. However, if you can prove that you've endured a "unique hardship", you may be able to avoid repaying this loan. Keep in mind that it's extremely difficult to qualify for this status when it comes to getting rid of student loans.
Child support and alimony
If the court orders you to pay a certain amount of money for child support or spousal support, you must pay this. You will be unable to have these discharged if you do qualify for bankruptcy because these were court ordered.
However, it may be possible to have the amounts you must pay reduced, but this will be left up to the court, and you will need to make an appeal.
Tax debts
If you owe money to the Internal Revenue Service (IRS) for past taxes, you will have to pay this. However, you can set up a payment plan with the IRS that will allow you more time in getting your taxes paid.
Miscellaneous Debts
There are other debts that won't be discharged from your bankruptcy, and these are listed below:
1. Debts that you forgot to record when you filed for the bankruptcy. It's important to make a list of all the money you owe to creditors to ensure you don't forget any of these.
2. If you were the cause of another person's fatality because of being intoxicated, any fees that you must pay due to this injury would not be discharged.
3. Being charged for criminal activity or getting a traffic ticket.
It's ideal to know what debts won't be discharged before going to the trouble of filing bankruptcy if you're trying to get rid of these. Taking the time to discuss your individual financial situation with a bankruptcy attorney like Flippin Thomas C will allow you to know the full details that are involved when it comes to this legal status.
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