When individuals or spouses experience a difficult financial situation, they may wonder if bankruptcy protection is a good strategy to discharge their debt so that they can get a fresh start. It is important to note that regardless of the type of bankruptcy filed – Chapter 7, 11 or 13 – some debts may not be discharged in a personal bankruptcy.
Non dischargeable debts in a bankruptcy may include but are not limited to certain tax claims, debts for spousal maintenance in a divorce, child support, most student loan debt, debts owed to certain tax advantaged retirement accounts, debt accumulated from fees owed to certain condominium or cooperative housing, debt incurred from government fines and penalties, and judgements for willful and malicious injury to persons or property.
That said, dischargeable debts in a Chapter 7 bankruptcy include unsecured debt such as credit card debt that often represents a large portion of debt many filers wish to discharge. Medical debt is also dischargeable – a debt that can add up quickly following an unexpected health event.
Although some debt is not dischargeable in bankruptcy, liquidating qualifying debt often allows individuals and couples to more easily tackle remaining debt after the bankruptcy. It is advisable to discuss your unique situation with an experienced bankruptcy attorney to determine if bankruptcy protection is a good strategy for you and your family.
Will Bankruptcy Hurt My Credit?
Besides wanting to understand if their debt can be discharged in a bankruptcy, filers wonder about the consequences of filing bankruptcy. Although a bankruptcy may be reflected on a credit report anywhere from 7 to 10 years, some filers report a rather immediate improvement (6 months to a year) in their credit after filing. While every situation is unique, taking the necessary steps to resolve a difficult financial situation is the first step to improving your credit worthiness. Discussing your financial goals with a bankruptcy attorney can help you decide if a Chapter 7 or 13 Bankruptcy is a good strategy for your situation.
Contact Peoria Bankruptcy Attorney Charles E Covey
If you have questions regarding Illinois bankruptcy protection, contact Peoria bankruptcy attorney Charles E. Covey for immediate assistance today at 309-674-8125.
