The Facts About Consumer Debt
Business and Consumer Bankruptcy Lawyers — Boston, Massachusetts
In the bankruptcy process, not all debts are considered equal. Some you can discharge. Some you cannot. Some, like taxes or student loans, you can — but only under rare circumstances.
To discuss a possible bankruptcy and to find out what you can and cannot obtain a debt discharge for — contact the Law Offices of Richard N. Gottlieb.
Generally, you may be able to discharge the following types of consumer debt under Chapter 7 of the U.S. Bankruptcy Code:
- Personal loans
- Credit card debt
- Repossession deficiencies (e.g. the difference between what a creditor sold your car for and the amount you owed on it)
- Auto accident claims
- Monetary judgments against you
- Negligence claims (personal injury)
- Business debts
- Leases
- Debts incurred through embezzlement or larceny
Generally, Chapter 7 will not allow you to discharge:
- Criminal fines and debts (e.g. debts resulting from a DUI/DWI/driving while intoxicated accident)
- Student loans (can be discharged under RARE circumstances)
- Recent taxes (within three years)
- Fraudulent debts (e.g. credit card abuse prior to bankruptcy)
- Dischargeable debt you incurred to pay off nondischargeable debt (e.g. using a credit card to pay off mortgage companies or the IRS)
- Court-ordered spousal support or child support
- Divorce property settlements (unless agreed to)
- Unlisted debts
Generally, debts that are at least partially dischargeable under Chapter 13 include:
- Recent tax penalties
- Debts for willful and malicious injury to property
- Debts incurred to pay nondischargeable tax debts
- Debts related to divorce or separation proceedings and property settlements
- Debts incurred by fraud or malicious and criminal activity
- Priority debts such as taxes, wages owed to employees, Social Security benefits, pensions, etc.
- Secured debt (car loans, mortgage debt)
We preface each of these lists with the word "generally" because there can be some variance. However, no matter what type of bankruptcy you file, going forward you must be responsible and proactive with all of your debts.
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Call us in Boston, Massachusetts, or contact us online for a free initial consultation with an attorney. Office hours: Monday through Friday from 9 a.m. to 5 p.m. and by appointment. Cancellations and reschedules require a 24-hour notice or a $25 fee will apply.
