Difference Between Dischargeable and Non-Dischargeable Debts With Bankruptcy and Business Debt Settlement
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.
Bankruptcy is oftentimes a lengthy and arduous process. However, this can all be avoided by seeking a 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.
Bankruptcy Myths With Business Debt Settlement
Bankruptcy has quite a negative reputation, and it’s unfortunate that this keeps people from utilizing all the resources available to them. The many myths associated with bankruptcy could be holding you back. Before you turn your back on bankruptcy, take a look at these shattered myths first.
Myth: Everybody is going to know that I filed for bankruptcy.
Fact: Few people are going to realize that you’ve filed. The legal proceeding may be public, but it takes effort to seek out the details. Unless somebody is actively looking, he or she is not going to know. Even if your bankruptcy is published in the paper, chances are small that it will actually be seen.
Myth: Chapter 7 bankruptcy will eliminate all my debts.
Fact: Unfortunately, this is not the case. There are certain kinds of debts that simply cannot be discharged. These include child support payments, student loans and criminal restitution. Taxes often fall into the same boat. You are still typically responsible for paying these off after bankruptcy, but there are some exceptions
Myth: Bankruptcy will leave me with nothing.
Fact: Bankruptcy does not leave you with no belongings. Most people end up keeping their belongings. Homes and cars are yours as long as you can continue making the payments on them.
Myth: I will never be able to have good credit again.
Fact: You can have credit again, though you may have to contend with higher interest rates. You can also begin building credit again with prepaid credit cards and the like. Your credit is not permanently ruined if you turn things around.
Myth: Filing for bankruptcy means that I am irresponsible.
Fact: Filing is actually the most responsible thing you can be doing in some cases. Filing for bankruptcy once is not an abuse, especially if you are trying to deal with unemployment, legal fees, divorce of something similar. Instead of seeing bankruptcy as “the end,” look to it as a new beginning.
Myth: Filing for bankruptcy is too complicated for me.
Fact: Bankruptcy paperwork really isn’t that complicated. An attorney will help you compile all the necessary documents to make it as simple as possible.
Myth: Bankruptcy isn’t going to do me any good because creditors will continue to harass me.
Fact: Once your bankruptcy has been completed, a creditor is not allowed to contact you. This could be considered harassment, and this is required to stop. This includes snail mail, phone calls and electronic mail.
Myth: I can’t file bankruptcy because I have a job.
Fact: You might have a well-paying job, but this does not mean you cannot file. In fact, filing for Chapter 13 bankruptcy requires you to have a job in the first place.
Myth: I won’t be able to discharge medical debt.
Fact: Just like debt related to credit cards and personal loans, you may be able to discharge medical bills. Of course, your lawyer will have more information about which bills qualify.
Myth: If I am married, my spouse must file with me.
Fact: While a married couple is allowed to file bankruptcy together, it is not mandatory. Of course, you should still defer to your attorney to learn more about which property falls into the bankruptcy estate. You should be well aware of all your options.
Myth: My employer can fire me for filing for bankruptcy.
Fact: According to federal laws, your employer is not allowed to fire you simply because you have filed for bankruptcy.
Bankruptcy may seem intimidating, but this is no excuse to avoid it. You might find that it is the right decision for you. It is always wise to speak to a bankruptcy attorney before making the decision. Your NYC bankruptcy law firm can help you cope with all the stress that accompanies the process.