Posted on behalf of O'Connor, Acciani & Levy on Aug 07, 2017 in Bankruptcy
One of the benefits of filing Chapter 7 or Chapter 13 bankruptcy is that some of your debts can be eliminated through a bankruptcy discharge.
A bankruptcy discharge is a court order prohibiting a creditor from taking any further action to attempt to collect a debt that you list in your bankruptcy case, this includes making phone calls, sending demand letters, reporting nonpayment of the debt to credit reporting agencies, filing a lawsuit or engaging in any other debt collection activities.
If you are thinking about filing bankruptcy or have already done so, you may have a lot of questions about a bankruptcy discharge. Below, O'Connor, Acciani & Levy's trusted Cincinnati bankruptcy lawyers provide answers to some of the most frequently asked questions about bankruptcy discharges.
Schedule a free, no obligation legal consultation with our lawyers to see if we can help with your bankruptcy filing.
In a Chapter 7 bankruptcy, the trustee sells nonexempt assets listed in your filing and uses the proceeds to pay off your creditors. You can discharge many of your remaining debts, including:
Courts are prohibited from discharging certain debts under U.S. Code Title 11 § 523, such as:
In a Chapter 13 bankruptcy, you agree to a repayment plan to pay back all or most of your debt. Once you finish carrying out the terms of your repayment plan, you can discharge many of the same types of unsecured debt as you can in a Chapter 7 case, including:
However, a Chapter 13 filing also allows you to discharge certain debts that are non-dischargeable in a Chapter 7 filing, such as:
The following types of debt are non-dischargeable in a Chapter 13 bankruptcy filing:
You cannot discharge a student loan in Chapter 7 or Chapter 13 bankruptcy unless you prove to the court that repaying the loan would be an undue hardship.
Some courts use a three-pronged test to determine if paying the loan would be an undue hardship. If your situation meets these three criteria, your student loan debt could be discharged:
Other courts consider these and other factors when determining if paying your student loans represents an undue hardship.
In a Chapter 7 filing, debts are usually discharged about four months after the date you file your bankruptcy petition.
However, in a Chapter 13 case, debts are not discharged until your payment plan is completed, which is anywhere from three to five years after your filing.
The court can deny a Chapter 13 or Chapter 7 discharge if the debtor fails to complete the financial management course required by the court.
In a Chapter 13 case, a discharge can also be denied if:
Discharging debt via bankruptcy does not affect the amount of time a bankruptcy will be listed on your credit report.
If you file Chapter 13 bankruptcy, it will be listed on your credit reports seven years from the date of filing. If you file Chapter 7, the bankruptcy will be listed on your credit report 10 years from the date of filing.
There are certain circumstances under which a discharge can be revoked. In a Chapter 13 case, a discharge can be revoked if it was obtained through fraud. In a Chapter 7 filing, the discharge can be revoked under any one of these conditions:
Discharge can also be revoked if the debtor committed any of the acts of impropriety listed in section 727(a)(6) of the Bankruptcy Code, including:
Bankruptcy might be your only option for getting yourself out of debt and on the road to a financial recovery.
Unfortunately, the bankruptcy process is complicated and time-consuming. This process is difficult to navigate on your own, even in the best of circumstances.
That is why you should strongly consider hiring an experienced Cincinnati bankruptcy attorney to help guide you through the process.
We offer a free, no obligation legal consultation where you can discuss your situation and we can review all of your options.
Contact us today by completing a Free Case Evaluation form.
With a proven track record of success that has resulted in our team of legal professionals recovering tens of millions in compensation for our clients, we work quickly to obtain a fair and just result for your case.
We also offer complimentary consultations to determine the merits of your claim and in most instances, we only get paid when we obtain a recovery on your behalf.
Contact the personal injury lawyers at O'Connor, Acciani & Levy today for a free case evaluation to discuss your claim.