Chapter 13 bankruptcy is an option where you are required to repay some of your debts in full through a three to five-year repayment plan. Through this, you will pay unsecured, non-priority creditors in part, and when your plan comes to a close the remainder of your debt is discharged. But of course, not all of your unsecured, non-priority debts will be discharged following your bankruptcy. There are a handful of debts that are considered non-dischargeable.
Regardless of your circumstances or income, that are certain types of debt that will survive Chapter 13 bankruptcy. For starters, any domestic support obligations will remain. If you owe child support and alimony directly to an ex-spouse or child, it will be non-dischargeable. It will also be accounted for 100 percent in your repayment plan.
If you have been fined or owe restitution for the conviction of a crime you committed, it will not be discharged under Chapter 13 bankruptcy. This includes any debt arising out of an injury or death you may have caused another while driving under the influence of drugs or alcohol.
Other non-dischargeable debts include any debts not listed in your Chapter 13 petition. Maybe you forgot to list a creditor or accidentally misstated a creditor’s address or identity. This means the court will not notify them of your bankruptcy and their debt will almost always survive. It is extremely important to take care and be thorough in listing your debts in full when filing for bankruptcy.
Student loans are another type of non-dischargeable debts. In most cases this holds true but there are exceptions. If you are able to prove that paying your student loan back would incur substantial hardship, you might be able to discharge the interest on your student loans. The principal will still remain.
Lastly, any debts based on theft, fraud, or breach of fiduciary duty will survive your Chapter 13 bankruptcy. The only time this type of debt will be discharged is if the creditor does not come forward to establish the fraud in the bankruptcy court.
Turn to Joel R. Spivack For Answers
In order to fully understand what you will be getting into when filing for bankruptcy, you need the expertise of Joel R. Spivack, Esq. The New Jersey bankruptcy attorney has years of experience helping all sort of clients across the state. He will help you determine which type of bankruptcy best suits your needs. Mr. Spivack can get you the fresh financial start you need and desire. Contact him today by filling out this online form.
The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.