The discharge process is one of the most important aspects of a Chapter 7 bankruptcy. It allows those that have debt to use the bankruptcy process to eliminate -- or discharge -- some of those debts from their record. Liquidation goes a long way towards eliminating these debts. But the process is a helpful one for many individuals and families all across the country.
Of course, the caveat to all of this is that not every debt can be discharged. Non-dischargeable debts exist, and there are plenty of things that are exempt from the discharge process. For example, student debt is the most commonly referenced non-dischargeable debt. Yes, there are extreme circumstances that can lead to student debt being discharaged -- but practically speaking, this debt can't be discharged. Nor can child support debt, personal injury judgments, alimony payments, and certain government penalties and fines.
Depending on your circumstances, a Chapter 7 bankruptcy may not be right for you. Considering the discharge process is the most critical piece of that bankruptcy process, if you have many debts that can't be discharged, then a Chapter 13 bankruptcy may make more sense for you. In that form of bankruptcy, a repayment plan is the central pillar of the bankruptcy, giving you some more time to sort out your finances and repay your creditors.
As always, whether you are going through a Chapter 7 or Chapter 13 bankruptcy, or if you are just considering the legal ramifications of bankruptcy in general, then consult with the attorneys at McBride Law.