People file bankruptcy to get a discharge on debts so they no longer need to pay creditors. A Chapter 7 discharge is a court order which states a debtor does not have to pay his/her debts scheduled in the bankruptcy filings.
Some debts cannot be discharged. For instance, the following debts cannot generally be discharged:
- Child support
- Student loans
- Court fines and criminal restitution
- Personal injury caused by drunk driving or under drug influence
Discharge applies to debts that arose before bankruptcy filing. Debts that occur after bankruptcy may still be collected by creditors. If a judge finds a debtor received money or property by fraud, the debt may not be discharged.
Creditors Listed in Filing
List all property and debts in the bankruptcy filing. If a debtor forgets to list a creditor, the debtor may end up having to pay the debt after a bankruptcy because the creditor had no notice of the bankruptcy.
The judge can deny a discharge if a debtor does something dishonest such as destroy or hide property, falsify records, or lie. Obeying a court order may also be cause for discharge denial. When people are in bankruptcy, they may fear losing everything, but this is better than going to jail or suffering fines for being dishonest. Being honest in bankruptcy allows a person to move on after discharge to begin a simple life. Being dishonest may result in criminal charges and prolonged emotional problems that not even a therapist can resolve.
A person can receive a Chapter 7 discharge once every 8 years. Some creditors hold secured claims. A debtor does not need to repay a secured claim after a debt discharge, but the creditor can take the property to sell it for fair market value.
Rinne Legal helps people with bankruptcies, estate planning, and loan modifications in Contra Costa County, Sacramento County and Solano County. Rinne Legal has offices in Walnut Creek, Fairfield, Sacramento and Elk Grove. Contact Rinne Legal for a free consultation. These blog posts are for informational purposes only and not intended nor should be construed as legal advice. These blog posts may be considered attorney advertising in some states. Prior results described on blog posts do not guarantee similar outcomes in future cases. There is no intent to create an attorney-client privilege or relationship with anyone accessing information on this blog. Authors posting on this blog are not obligated to reply to any emails seeking legal advice. The information contained on this blog is not intended to be a solicitation.From the author: Rinne Legal: Northern California Bankruptcy and Foreclosure Law Firm