In Bankruptcy, Blog, Eliminating Debt

In the bankruptcy arena, many have heard that they can get rid of their debt if they file for a specific chapter of bankruptcy. The legal terminology for this would be “bankruptcy discharge” and what this means is that some or all of the debts are released from you, leaving you no longer responsible to pay be the creditors for what you owe. Not only are you no longer responsible for not paying the debt, but the creditors are then also prohibited from contacting you in any way. This discharge happens differently for each individual depending on what type of bankruptcy you have filed for.

In the instance of a Chapter 7 claim, which is also known as liquidation, the court will likely allow the debt to be dismiss immediately or at least within the next couple months. For a Chapter 11 case is usually done as soon as the debtor can pay off the payments that were agreed upon in the debt payment plan, it is usually within 3-5 years. Often times when a person files for bankruptcy, by the court they are required to take educational courses involving credit card debt and financial management. If you fail to accomplish this in your scheduled time period, it is likely that the court wont grant you a discharge according to The Bankruptcy Code.

After the set amount of time and the debtor has followed all of the court requirements, they will usually be discharged automatically. The parties involved in the bankruptcy case will all receive notification of your discharge of debt including yourself and your lawyer. When most do receive the bankruptcy discharge, there are situations in which the court can chose to revoke the discharge. This would include if there were accusations against the debtor that they received the discharge illegally, if they failed to tell the court about recently acquired properties, or failed to comply with the Bankruptcy Code in anyway.

Though many of the debts will be discharged in the event of bankruptcy, not all of the debts will. In Section 523(a) of the Bankruptcy Code it specifically lays out the details of what they court will consider being dismissible through bankruptcy. Usually these involve tax claims or debts attached to child support or alimony, or if there are debts for injury claims, etc. Also, if a person willfully damages a property and has debt because of the repairs that too will not usually be covered in a discharge.

In the event of bankruptcy, having a competent lawyer on your side is crucial in order to see to it that you are well represented, and that you can be able to understand the laws regulations pertaining to your bankruptcy. There are many facets and details, and having a lawyer who will walk alongside you through this process is what you deserve. Contact Malaise Law Firms today for the legal counsel you need.