If you file for bankruptcy under Chapter 13, there are certain debts that will be released by a discharge. Many people who are going through bankruptcy tend to think that all debts will be released once they file for Chapter 13 bankruptcy, but that’s not how it works.
Today, our Salt Lake City Chapter 13 bankruptcy attorney Justin M. Myers is going to explain what debts are released by a Chapter 13 discharge and which are unaffected by your bankruptcy filing.
But before we get started, let’s get something out of the way: let’s define the term “Chapter 13 discharge.” What it means is basically a formal order by court that releases you (the debtor) from all dischargeable debts, and orders your creditors to stop harassing you and trying to collect the debts from you.
Once your debts have been discharged under Chapter 13 bankruptcy, you no longer have to pay these debts. Chapter 13 discharges fall into two categories:
Do note, however, that the first type of a Chapter 13 plan discharge releases a debtor from more debts than the other type.
Typically, these debts will not be discharged after you file for bankruptcy under a Chapter 13 plan:
Under a Chapter 13 bankruptcy plan, you can pay off any debt, both secured or unsecured. In fact, our Salt Lake City Chapter 13 bankruptcy lawyer says that even nondischargeable debts may be paid under the plan, including but not limited to child support, alimony, and student loans.
Many people were misguided to think that all debts must be paid in full if they file for bankruptcy under a Chapter 13 plan. That’s simply not true. Generally, certain debts such as those relating to taxes and fully secured debts must be completely paid off. But the vast majority of debts can be paid off only in the amount that you can reasonably afford.
In fact, if your Chapter 13 plan is nearing its completion, the unpaid balance of some debts may be discharged, our best bankruptcy attorneys in Salt Lake City say. Whatever is the case, it’s important to speak to a bankruptcy lawyer to find out what debts will and will not be discharged after you file for Chapter 13 bankruptcy.
Get a free consultation by contacting the offices of JMM Legal. Call at 1-801-505-9679 or complete this contact form.