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A bankruptcy discharge is a court order that releases an individual or business from specific debts and obligations they owe to creditors. In other words, it's a legal process that eliminates the debtor's liability to pay certain types of debts they owe before filing the bankruptcy case.
Even though bankruptcy does not always discharge all of your debts, it can still be helpful to file in some cases. Bankruptcy is designed to give filers a fresh financial start. Bankruptcy is ...
In United States bankruptcy law, an automatic stay is an automatic injunction that halts actions by creditors, with certain exceptions, to collect debts from a debtor who has declared bankruptcy. Under section 362 of the United States Bankruptcy Code , [ 1 ] the stay begins at the moment the bankruptcy petition is filed.
The rest of your debt is then discharged. Chapter 13 bankruptcy, known as reorganization bankruptcy, allows you to retain some of your assets while paying back your creditors over a set period of ...
In most cases, those who owe tax debts cannot discharge these debts in bankruptcy. “Tax debts are considered to be a priority because they are used to fund important government services ...
The disadvantage of filing for personal bankruptcy is that, under the Fair Credit Reporting Act, a record of this stays on the individual's credit report for up to 7 years (up to 10 years for Chapter 7); [5] still, it is possible to obtain new debt or credit (cards, auto, or consumer loans) after only 12–24 months, and a new FHA mortgage loan just 25 months after discharge, and Fannie Mae ...
The court could dismiss your case or change it to Chapter 7 if you’re late on your Chapter 13 payment. You can request a payment reduction or amendment if you’ve faced an unexpected financial ...
For example, the court may not allow you to reaffirm a debt of $3,000 for a vehicle that may be worth $1,000. If a debtor reaffirms a debt and fails to pay it, the debt remains owed as though there were no bankruptcy and the creditor can take action to collect the debt. This reaffirmed debt is not discharged or wiped out by the bankruptcy ...