Is Chapter 7 Right for You? Part Four
What types of debts can be eliminated in Chapter 7?
Many debts can be wiped out in Chapter 7 without repayment. Generally the list of dischargeable debts includes:
- Credit cards
- Medical bills
- Personal loans
- Payday loans
- Cash advances
- Internet loans
- Utility bills
- Vehicle deficiencies (balances owed on vehicle loans when you no longer have the vehicle)
- Mortgage deficiencies (balances owed on a home loan when you no longer have the home)
- Some tax debts
Can Chapter 7 wipe out my student loan debts?
Maybe. There are some instances where student loan debts can be eliminated through Chapter 7. Particularly, recent changes to the Department of Education’s procedures for dealing with student loan discharge in bankruptcy have made it less difficult to discharge student loan debts in some cases.
At a free consultation, Financial Freedom Legal can review your individual circumstances to determine if you may be eligible to discharge your student loans debts in Chapter 7.
Are there certain debts that Chapter 7 doesn’t resolve?
Chapter 7 is not very helpful with resolving debts that are attached to property that you wish to keep.
For example, if you desire to keep your home or vehicle that has a mortgage or vehicle loan attached, you will be required to maintain the payments on those debts in order to keep the property.
Similarly, if you are behind on debts that are attached to property that you wish to keep, such as your mortgage loan or vehicle loan, Chapter 7 is probably not going to be the most helpful option. However, some debts that can’t be resolved through Chapter 7 can be resolved through Chapter 13, which is another bankruptcy option available to help you get a fresh start.
Don’t Face Bankruptcy Alone
If you are considering Chapter 7, you do not have to navigate the process alone. At Financial Freedom Legal, we offer free bankruptcy consultations that can be completed via telephone, virtually, or in-person at our Richmond office. Let us help you explore your options and determine if Chapter 7 is right for you.
