Debts Not Discharged In Chapter 7 Bankruptcy
Posted on August 9th, 2010
The goal of filing Chapter 7 bankruptcy is the possibility of having some or all of your debts discharged. When a debt is discharged, it is essentially wiped away and you never have to repay it. However, there are certain debts and obligations that can never be discharged in a Chapter 7 bankruptcy.
In general, the following kinds of debt cannot be discharged:
All debts that you didn’t list on your bankruptcy petition will not be discharged;
- Criminal fines and debts: All court fees and court-ordered judgments related to any criminal activity cannot be discharged — neither are any judgments or debts incurred as a result of personal injury or death to others caused by your own negligence or criminal activity;
- Student Loans: Although there is a general policy not to discharge student loan debt, in some very rare circumstances, student loans can be discharged, particularly if a hardship condition exists;
- Taxes: Most tax debt cannot be discharged in bankruptcy. However, if you meet the following requirements your tax debt may be discharged:
- The taxes are income taxes. Taxes othe
The Bankruptcy Trustee Is Primarily Concerned With Equity
Posted on May 4th, 2010
Chapter 7 bankruptcy involves liquidating assets to pay back creditors in exchange for a complete forgiveness or discharge of most debts. Among other duties, bankruptcy trustees are charged with the responsibility of evaluating a debtor’s assets to see whether there is anything of significant value that can be sold to pass on to creditors. Absolutely everything you own must be disclosed, however, only non-exempt property is subject to sale. It is important to understand that a bankruptcy trustee will primarily be interested in property that has equity. What is equity? Equity is the value of property after any debt that encumbers it has been subtracted from the overall value. Fo
Educational Savings Account § 529
Posted on May 4th, 2010
One pitfall for debtors contemplating bankruptcy is contributing to an Educational Savings Account one year before filing for bankruptcy. Generally, contributions to an education IRA under section 529 of the Internal Revenue Code (IRS) are excluded from the bankruptcy estate. However, there are exceptions. Under the bankruptcy code, 11 U.S.C. 54
Underwater On A Second Mortgage? Consider Modifying It In Bankruptcy To Lower Payments
Posted on May 4th, 2010
The housing crisis is in full swing with unfortunately no end in sight. Your nationally chartered bank has recently notified you that you don’t qualify for their new “when pigs sprout wings” mortgage modification program. You have a second and third mortgage, not to mention a first mortgage that alone exceeds the value of your home. Stress is mounting and fast. You are as they say “underwater.” Your kids are in the school district of your choice, neighbors are great and your spouse loves the house. In other words, you do not want to surrender the home. If I’m wrong in this assessment and you’d like to walk away from an underwater home, click here. If your prefe