| BANKRUPTCY DEBTS |
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How can debts in bankruptcy be classified? |
| Debts can further be classified as dischargeable and non-dischargeable. With the dischargeable debts, the debtor is no longer required to pay up after the bankruptcy is filed. Where as, with non-dischargeable debts, you are liable to pay even if you have not filed bankruptcy. |
| What does Discharge in Bankruptcy mean? |
| Discharge in Bankruptcy means you are legally free of certain debts after filing bankruptcy. The creditor has no right to collect and the debtor has no obligation to pay. |
| Which debts can be discharged while filing bankruptcy? |
| Credit card, Charge card, Legal, Medical, Departmental, Gasoline Bills .Loans from family and friends and judgmental loans. |
| Which debts cannot be discharged while filing bankruptcy? |
| Tax claims, Fines and penalties, Spousal and child support claims, Student loans and secured debts, Debts not listed with courts , drunken driving obligations, false claims and fraud claims with an intent to deceive. |
| Does bankruptcy free me in exchange of losing some of my possessions? |
| The Federal Bankruptcy Code exempts some property that can be retained by the debtor. This can be either by the state laws or the federal code. Chapter 7 bankruptcy looks at the property that is not exempted. But exempt and non-exempt does not hold good for Chapter 13 bankruptcy. |
| What does a reaffirmation agreement contain? |
| A reaffirmation agreement is done between a creditor and debtor. It says that the debtor will pay the amount of money owed by him, despite filing bankruptcy, while the creditor will not posses or re-posses his property as long as the amount is paid. |
| What does hardship discharge mean? |
| A hardship discharge is available to debtors who are not able to make payments because it is beyond their capacity or due to certain unavoidable circumstances. Injury or Illness can serve basis for a hardship discharge. |
| If a creditor is attempting to collect on discharged debt, what can be done? |
| The debtor can file a motion in court, asking to reopen the case. In many cases, the court does so, in order to avoid the discharge being violated. A violation on creditor’s part is civil contempt. |
| How can a bankruptcy case be reopened? |
| A bankruptcy case can be reopened if any new issues pertaining to debtor or creditor crop up. That includes inheritance received, divorce settlement, insurance payment etc. |
