Can You Discharge Debt Through Bankruptcy?
Is bankruptcy the answer to your financial troubles? It depends on many factors, including the amount you owe, the nature of your debt and which chapter your bankruptcy is filed under. Some debts are eliminated completely, while other debts cannot be reduced at all through bankruptcy.
At Scura, Mealey, Wigfield & Heyer, LLP, our goal is to help clients end creditor harassment, stop foreclosure and other drastic actions, and eliminate as much debt as possible. We are skilled at taking maximum advantage of a bankruptcy filing.
We help individuals, couples and small business owners of northern and eastern New Jersey get a fresh start and peace of mind through bankruptcy. Contact us to arrange a free consultation at our offices in Wayne, Hoboken and Elizabeth.
What Debts Are Covered in Bankruptcy?
Unsecured debts (debts which are not guaranteed by collateral) can generally be discharged. This includes:
- Credit card and charge account balances
- Medical bills
- Utility bills
- Many judgments
- Some back taxes
In a Chapter 7 bankruptcy, qualifying debts are fully erased. In a Chapter 13 bankruptcy, you will pay down your debts over several years. However, many Chapter 13 debtors pay back only a fraction of what they owe.
What Debts Are Not Dischargeable?
Secured debts (home mortgage, car loan) are discharged, but if you are keeping the house or vehicle you will need to pay that debt. Bankruptcy does buy you an opportunity to catch up on the arrears on secured debt, such as a mortgage or car loan, without fear of foreclosure or repossession.
Some obligations are not dischargeable in a Chapter 7, including student loans, child support or alimony, recent taxes, criminal fines or judgments for causing personal injury. We can help clients discharge or negotiate IRS debt/income tax debt and we can help clients alleviate nondischargeable taxes and other ineligible debts through Chapter 13.
Discuss Bankruptcy With New Jersey Dischargeable Debt Attorneys
Even if you cannot discharge all your debts, bankruptcy provides immediate relief from creditors and frees up your finances to pay down those remaining debts. At your free initial consultation, we will explain which of your debts qualify and what your financial picture will look like after bankruptcy.
Contact one of our lawyers today to arrange a consultation at one of our office locations in Passaic, Hudson or Union County, New Jersey.
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