What Types of Debts Can Be Discharged

Discharge is not an “elimination” of debt. However, it is an “injunction” against a creditor from ever collecting that debt from the Debtor.

The most common debts that can be discharged 

Include but are not limited to:

1. Credit card debts
2. Payday loans
3. Personal loans
4. Some Tax debt
5. Signature loans
6. Department store credit cards
7. Utility bills
8. Repossessions
9. Foreclosures
10. Medical Bills

There are always exceptions

If a Debtor has debts that fall under the exceptions listed in the Bankruptcy Code, some or all of the Debtor’s debt will survive the bankruptcy discharge.

Include but are not limited to:

1. Student Loans
2. Child Support
3. Spousal Support
4. Debts Required to be Paid Pursuant to an Order of the Court During the Course of a Divorce or Separation
5. Debt Incurred where there is a Death or Personal Injury caused from the operation of vehicle while the Debtor was under the influence of alcohol, a drug, or another substance,
6. Certain Tax Debt, are NOT dischargeable.

Other debts as listed above, could be determined nondischargeable if an adversary proceeding is filed by a creditor and the Court determines that debt is not dischargeable due to some action of the Debtor such as obtaining credit by fraud, false statements, and false representations, making material false statements in writing with the intent to deceive. In addition, if a Debtor incurred debt to any single creditor of more than $550 for luxury goods or services within 90 days of filing bankruptcy; or took cash advances aggregating more than $825 within 70 days of filing bankruptcy, those debts could be determined by the Court to be nondischargeable.

Of course, if the Debtor files his or her bankruptcy case before the expiration of time required to file another bankruptcy case, none of the Debtor’s debt will be discharged. If the bankruptcy case is Chapter 7, the case will probably be dismissed or converted to a Chapter 13 bankruptcy case.