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Michael D. Hart, P.C.
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The debts that can be discharged in bankruptcy

Virginia residents who are planning on filing for bankruptcy have different methods available. For those with a steady income, a Chapter 7 case involves liquidating assets and using the money to repay creditors. A Chapter 13 case involves reorganizing current debts and repaying them over the course of several years. At the end of the repayment period, the remaining debt could be discharged. Generally speaking, only those who meet the income threshold in the state can file for Chapter 7 bankruptcy.

Furthermore, it is not possible to file for Chapter 7 bankruptcy less than eight years after a previous case is discharged. A bankruptcy could stay on a credit report for up to 10 years. The type of bankruptcy a person chooses to pursue may also depend on the type of debt he or she has. Individuals who have a car or home might be able to keep these assets by filing for Chapter 13 bankruptcy.

As a general rule, unsecured debt can be discharged in a bankruptcy case. Unsecured debts include credit card bills, medical debts and anything else not secured by collateral. Auto loans, mortgages and other debts secured by collateral could be discharged in bankruptcy, but it may result in losing an asset. Tax debts and student loans are generally not discharged in any kind of bankruptcy proceeding.

By filing for Chapter 13 bankruptcy, an individual may be able to obtain more time to renegotiate the terms of a secured debt. It could also allow more time to pay any type of debt in an affordable manner. Debtors are generally granted an automatic stay from creditor contact during the course of a bankruptcy. This could mean no more phone calls or letters for as long as a case remains open. Those who are interested in the benefits of bankruptcy may want to talk with an attorney.

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Michael D. Hart, P.C.
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Roanoke, VA 24011

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