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What a discharge means in a Chapter 7 bankruptcy

On Behalf of | Aug 1, 2016 | Credit Card Debt, Firm News

Getting some relief from overwhelming debts is something that many Florida residents both need and desire. However, there could be some confusion as to what debts can be discharged in a Chapter 7 bankruptcy and what debts cannot be. Here, we will explore the debts that generally are not subject to discharge.

Many Florida residents are familiar with the fact that they generally cannot receive a discharge for certain taxes and student loans. These are not the only debts that filers will still be liable for after the bankruptcy is closed. It might not be surprising to know that alimony and child support are included as well. However, filers might not be aware that any judgments for personal injury claims that are the result of driving under the influence of alcohol or drugs are also not subject to discharge.

The discharge received in a Chapter 7 is limited to the debts that an individual incurred as of the filing date. Further, if any property or money was received through fraud, the debt associated will also not be discharged. It should be noted that if a creditor has a secured claim — which means that the debt is secured by a piece of property, such as a car, — the creditor may take the property, but you will not have to pay the corresponding debt if it is discharged.

Before embarking on the Chapter 7 bankruptcy process, it is important to understand that some of your debts might not be subject to discharge. Your attorney should explain this to you prior to filing so that you are aware of what debts, if any, you will retain afterward. If you have any doubts regarding whether you will remain liable for a debt, be sure to bring it up with your attorney right away.

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