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When the discharge process starts, which debts can be eliminated?

One of the most important aspects of a bankruptcy filing is the debt discharge process. This is the stage of the bankruptcy that sees many of your past debts eliminated (either partially or wholly) and it can free you up after the bankruptcy so that you can get your financial life back on track.

But what debts can be discharged during this process? And are there any other aspects to the discharge process that the filer should worry about?

Let's take the former question first. What can be discharged in bankruptcy? Most debts can be discharged, though it is nearly impossible to discharge student debt (barring extreme circumstances). You can discharge credit card debt, medical debt, certain tax debts, utility payments and rent that are past due, car loans, and mortgages. This covers a lot of ground, and it can be very helpful to clear these debts out.

One thing to be wary of, though, is that if your car is repossessed or your home if foreclosed on, those assets could sold at auction. When they are, if the auction price is less than the amount that you still owed on the car or home, then you are responsible for the remainder. This is called the "deficiency," and if it isn't paid, creditors could garnish your wages. The debt discharge process can eliminate these deficiencies.

If you are considering a bankruptcy, please consult with the attorneys at McBride Law. We will review your case and give you honest feedback on your situation, even if that means avoiding a bankruptcy filing.

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McBride Law Firm

McBride Law Firm
301 Jackson Street Suite 101
Alexandria, LA 71301

Phone: 318-625-0471
Fax: 318-445-8066
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