Some Debts Need to Be Repaid Even in Bankruptcy
Certain categories of debt are specifically excluded from discharge in bankruptcy, regardless of the chapter you're filing under. In other words, the creditor's right to collect the debt will continue even after the completion of your Chapter 7 or Chapter 13 case.
The advice of an experienced bankruptcy attorney can help you find ways to deal with the challenges presented by nondischargeable debt. To learn more about your options, contact a New Jersey consumer bankruptcy attorney at Purrazzella & Purrazzella in Toms River.
Some debts are presumed to be nondischargeable, subject to the debtor's ability to show a right to discharge, usually under hardship circumstances. Other debts can be listed as eligible for discharge, subject to the creditor's ability to show why it should be excepted for a particular reason, such as fraud. Nondischargeability in other cases might be categorical and beyond dispute, or dependent on such circumstances as the age of the debt or the reason why it was incurred.
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If a substantial part of your indebtedness is nondischargeable, you might consider filing under Chapter 13, which allows you to pay down the indebtedness over a three-to-five year period under bankruptcy protection. Additionally, your bankruptcy petition will stop interest and penalty payments from increasing. Even though you won't be entitled to discharge of certain debts, many people find that the discharge they receive on other debts gives them the cash flow necessary to pay down the debts they can't discharge.
Examples of nondischargeable debt include:
- Tax debts less than three years old, or for which returns were never filed
- Student loans
- Child or spousal support
- Certain credit card debts incurred shortly before bankruptcy
- Debts reflecting fraud on the part of the debtor
- Personal injury damages related to DUI or DWI
Purrazzella & Purrazzella has more than 30 years of experience advising bankruptcy clients in Ocean County and Monmouth County. Our lawyers can review your situation to tell you which debts are dischargeable, which are nondischargeable, and the best ways to deal with the debts that will need to be repaid. For a free consultation, contact our office in Toms River.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.
