5 Things to Know About Consumer Bankruptcy Discharges
If you are considering consumer bankruptcy in Orlando, it is important to have the information you need about bankruptcy discharges. Many people file for bankruptcy under the assumption that a discharge will be automatic and quick, while other consumers do not realize that different types of personal bankruptcy have different timelines for a discharge. While you should always speak with an Orlando bankruptcy attorney about your case, we want to provide you with more information to help you as you consider whether bankruptcy is the right choice for you. The following are five things to know about consumer bankruptcy discharges.
- Bankruptcy Discharges Are Not Automatic When You File for Consumer Bankruptcy
The mere act of filing for consumer bankruptcy, under Chapter 7 or Chapter 13, does not automatically mean that you will be able to have your debts discharged. To be sure, personal bankruptcy is a lengthy process with many different requirements under the U.S. Bankruptcy Code. A bankruptcy lawyer can assess your case and help you to understand whether your debts are likely to be discharged.
- Consumer Bankruptcy Discharges Occur at Different Times, Depending Upon the Type of Bankruptcy
Whether you file for Chapter 7 bankruptcy or Chapter 13 bankruptcy can radically shift the date of your bankruptcy discharge. Under Chapter 7, eligible debts are discharged at the close of the bankruptcy case since it is a liquidation bankruptcy (usually anywhere from four to six months after you file). Under Chapter 13, however, debts are discharged after a debtor completes the term of the repayment plan (usually three to five years after the plan is approved by the bankruptcy court).
- Not All Debts Are Dischargeable
Many debts simply are not eligible for discharge, or are considered “nondischargeable.” This includes, for example, debts owed from family support (like child support) and certain types of tax debt. You should always consult a bankruptcy lawyer before you file to ensure that the debts you are seeking to discharge are in fact dischargeable under the U.S. Bankruptcy Code.
- Some Debts Are More Difficult to Discharge Than Others
Some debts are simply more difficult to discharge than others, and the obvious example is student loan debt. While discharging student loan debt is possible, the debtor needs to be able to show an undue hardship and a record of attempts to repay the debt.
- Cosigners Can Still be Responsible for the Debts Discharged In Your Bankruptcy Case
If you have debts for which you have a cosigner, it is extremely important to understand that the discharge of your debts does not discharge the debt for your cosigner. To be sure, your cosigner will still be responsible for that debt. There are ways to handle this, including reaffirming a debt, but you should speak with a lawyer before you make any decisions.
Contact an Orlando Bankruptcy Attorney
Are you thinking about filing for Chapter 7 bankruptcy or Chapter 13 bankruptcy? A dedicated Orlando bankruptcy lawyer can begin working with you today on your case. Contact Anderson & Ferrin for more information about the services we provide to individuals and families struggling with debt in Central Florida.