Getting debt discharged in a Chapter 7 bankruptcy

June 23, 2017 Mark

On behalf of Gregersen Law posted in blog on Friday, June 23, 2017.

If you are one of the many Utah residents struggling financially, it is okay to question what debt relief options will really help you in the long run. There are so many band aid solutions out there that seem appealing, but really, bankruptcy may best serve your needs. However, submitting a Chapter 7 petition can be frightening, especially if you are not sure how it will really help you.

The main benefit of pursuing a Chapter 7 bankruptcy filing is immediate debt discharge. What does that mean? How exactly does discharge work?

Discharge basics

If you file a Chapter 7 bankruptcy petition and it receives approval in court, you may have some of your debts immediately cleared. This means a release from your financial obligation and that you can stop making payments to the affected creditors. Sound too good to be true?

While the discharge of debt can certainly help you on your journey to financial freedom, not all debts qualify for discharge. Those debts that not affected by a Chapter 7 approval include:

  • Alimony and child support
  • Loans for higher education
  • Civil/Criminal fines and restitution
  • Certain taxes

A Chapter 7 bankruptcy may not free you of all of your debts, but by clearing some, it can make it easier to pay the others.

Will filing for bankruptcy put an end to creditor harassment?

It should. Unfortunately, there are some creditors who may still try and contact you in order to seek payment. If this happens and the court has discharged your debt, you may file a complaint with the court to get the harassment to stop.

How long after bankruptcy approval will the discharge of debts occur?

As soon as the court sends out notices to the affected creditors, you can stop making payments. This generally happens within days of court approval. On average, from first filing a bankruptcy petition to when discharge occurs is about 90 days. If any of your creditors object to your filing, it may take longer.

Seek help and get relief

It is unfortunate that so much about this life revolves around money. When you are in a position where you just do not have enough, it can make life really hard with which to cope. A Chapter 7 bankruptcy filing can bring financial relief if you qualify. An experienced attorney can help you determine if this is a good option for you and will assist you in pursing it if it is.