Which Debts are not Discharged in Bankruptcy?

Medical bills, unemployment, and snowballing credit card debts are all common causes of bankruptcy in the United States today. If you are considering filing for personal bankruptcy, it is crucial that you discuss your options with our Los Angeles bankruptcy attorney to ensure the decision is the best one possible for your personal situation.

Filing for bankruptcy is not always the best choice for all those struggling with heavy debt loads. That’s because not all debts are eliminated through either chapter 7 bankruptcy or chapter 13 bankruptcy. Filing for bankruptcy with primarily non-dischargeable debts may cause damage to your credit rating without providing you the accompanying relief from debt.

Non-dischargeable debts can include certain tax debts, debts related to spousal or child support, government fines or penalties, student loans, debts related to DUI offenses, and debts related to certain retirement plans. Debts that you have not listed, debts that are linked to a bankruptcy that was dismissed due to fraud, and debts linked to restitution are also generally not dischargeable.

Most unsecured debts, such as credit cards and personal loans, are dischargeable. Some debts linked to fraud, divorce, and breach of trust may also be dischargeable. The rules governing which debts are dischargeable or not dischargeable can be extremely complex and legal guidance can help you determine whether bankruptcy can provide you with the financial relief you seek.

When you do file for personal or business bankruptcy, you are protected not just from creditor harassment but also from losing all your personal property, thanks to bankruptcy exemptions. Many states offer debtors their choice between federal exemptions or state exemptions. California offers two sets of exemptions from which you may choose.

Contact our bankruptcy lawyer in California today to learn more about your options for bankruptcy or to schedule your consultation.

Source: Hamid Soleimanian, Bankruptcy Attorney Los Angeles
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