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What types of debt are dischargeable in bankruptcy?

On Behalf of | Jul 6, 2017 | Blog

If you are thinking about filing for bankruptcy in Tennessee to get a fresh financial start and protect your home, cars and other assets from repossession, you should take some time to learn about the types of debts that are dischargeable. You may have many kinds of debt that you are struggling to pay. However, the type of relief you receive from those debts is dependent on your circumstances and the type of bankruptcy you file for. 

Here is a brief overview on debts that are dischargeable in bankruptcy. 

Some debts that are eligible for discharge under chapter 13 are not eligible for discharge under chapter 7 bankruptcy. Common debts that are not dischargeable include child support, alimony, domestic support, certain government charges and financial obligations you incur after filing for bankruptcy. 

Chapter 13 dischargeable debts 

Debts that occur from the willful or malicious destruction of property are dischargeable under chapter 13 bankruptcy code only if they did not result in the injury or death of another person. Bills that you incur from paying a tax liability, such as taking out a personal loan or using a credit card to cover a tax obligation, qualify for discharge. Other bills that are dischargeable in chapter 13 include those from a previous chapter 13 filing, HOA fees and debts you omit from your filing. 

Some debts are normally non-dischargeable. However, if you can prove extreme hardship, you may qualify to have them dismissed. Student loans, certain fees owed to the government, and debts incurred by fraud and income tax and other priority secured debts all have special stipulations in place that must be met to have them dismissed. 

Because the rules governing chapter 13 and chapter 7 bankruptcy debts differ, it can be challenging to know which type of bankruptcy is right for you. You may want to consult with an attorney to discuss your situation and learn more about your options.