Living in Bankruptcy Confusion? Escape The Stress! Nothing But Blue Skies From Now On.

What Debts Do I Still Owe After Bankruptcy?

AFTER MY BANKRUPTCY CASE IS OVER, WHAT DEBTS DO I STILL OWE?

Bruce C. Truesdale, Esq.

Bruce C. Truesdale, P.C.

 

The completion of your bankruptcy case will result in the “discharge” of most of your debts.  This means that you no longer have a legal obligation to pay them.  But there are certain debts that are not discharged in your bankruptcy case.  Following are some of the debts that are generally not discharged in your bankruptcy case.

–          Domestic support obligations:  Alimony, maintenance or support owed to spouse or children.

–          Taxes: Most tax debts cannot be discharged.  Some income taxes can be discharged under the right circumstances.  This is a complicated question that your bankruptcy attorney will have to examine with you in some depth.

–          Student loans: Most student loans are not going to be discharged in a bankruptcy case.  There is a provision under the bankruptcy code to discharge them for “undue hardship” but it is a very difficult case to make that paying the student loans is an undue hardship.  With government backed student loans there are many programs available that will reduce the loan payments in many instances.  You will need to go over some of these options with your attorney.

–          Criminal and quasi criminal fines, penalties and restitution: These debts include small fines imposed in municipal court for traffic tickets.

–          Claims for injuries caused while driving drunk: If a person causes injury to another person while driving drunk, the associated debt will not be discharged in a subsequent bankruptcy case.

–          Money obtained under false pretenses or by fraud: If a debtor lies to a creditor to obtain goods, money or services and a creditor can prove that it was defrauded by the debtor, the debt will be discharged in the bankruptcy case.  Beware that the creditor must prove that it was defrauded.  Sometimes these suits are brought by creditors to scare a debtor into reaffirming the debt.  If a creditor brings such a suit and loses, the Court may require the creditor filing the suit to pay the debtor’s attorney fees.