Dischargeable & Non-Dischargeable Debt

Sometimes it’s good to stop and define what common words in bankruptcy proceedings really mean.

One such word is the “discharge” of debts. What does it mean that debts are discharged under Chapter 7 bankruptcy? It means they are wiped clean. You no longer have to pay those bills — the debt that was causing you such stress is erased.

For most people it is the single greatest moment in Chapter 7, occurring at the end of the process. You get a letter from your trustee explaining that you no longer need to pay many or all of the debts named in the letter.

It is important to remember that while many debts are dischargeable, others are non-dischargeable. Some dischargeable debts include the following:

• Credit card debt
• Leases
• Medical bills
• Business expense debts
• Personal loans
• Unpaid car debt following the vehicle’s repossession
• Some unpaid taxes
• Car accident-related judgments against you
• Court judgments against you
• Even secured automobile debt is dischargeable if you return the property you purchased

Howell Non-Dischargeable Debt Attorney

Some examples of non-dischargeable debt:

• Child support
• Spousal support (alimony)
• Student loan debt (unless you can demonstrate serious disability)
• Taxes that came due in the past three years
• Car accident judgments against you if you were found to be intoxicated
• Debt from fraudulent use of a credit card
• Debt you took on in bad faith
• Fines or fees related to the commission of a crime
• Dischargeable debt used to pay off non-dischargeable debt
• Some debts incurred during a divorce or separation