Chapter 13 bankruptcy can provide a path to financial stability for those struggling with overwhelming debt. This type of bankruptcy allows individuals to reorganize their debts and create a repayment plan over three to five years. One of the significant benefits of Chapter 13 bankruptcy is that it can discharge various types of debt. Understanding the types of debt that can and cannot be discharged with Chapter 13 can help you understand if Chapter 13 is right for you. To discuss your situation with an experienced professional, contact a Chapter 13 bankruptcy lawyer today.
Credit Card Debt
Credit card debt is one of the most common types of debt that can be discharged under Chapter 13 bankruptcy. This includes balances, late fees, and interest charges. Once your repayment plan is completed, any remaining credit card debt can be discharged, providing much-needed relief.
Medical Bills
Medical bills can quickly accumulate and become unmanageable, especially without insurance. Chapter 13 bankruptcy allows for the discharge of medical debts, helping individuals manage their finances better and focus on their health without the constant stress of unpaid medical expenses. To determine if you should pursue discharging your medical debt through Chapter 13 bankruptcy, contact a lawyer today.
Personal Loans
Unsecured personal loans, which are not backed by collateral, can also be discharged through Chapter 13 bankruptcy. These personal loans can include loans from banks, credit unions, or even personal loans from friends and family. After successfully completing the repayment plan, any remaining balance on these loans can be wiped out.
Utility Bills
Past-due utility bills are another type of debt that can be included in your Chapter 13 bankruptcy plan. This can cover overdue electricity, gas, water, and even phone bills. Including these debts in your bankruptcy plan can help you avoid service interruptions while you get back on track financially.
Certain Tax Debts
While most tax debts are not dischargeable, some older tax obligations might be eligible for discharge under Chapter 13 bankruptcy. These typically include income taxes that meet specific criteria, such as being more than three years old and meeting certain filing requirements. Attorneys such as our friends at Resolve Law Group recommend consulting with an experienced lawyer to help determine if your tax debts qualify.
Car Loan Deficiencies
If your car has been repossessed and sold for less than what you owe on the loan, the remaining balance (deficiency balance) can be discharged through Chapter 13 bankruptcy. This can provide relief from paying for a car you no longer possess.
Lease Obligations
Unpaid rent from a previous lease agreement can also be included in your Chapter 13 bankruptcy plan. This can apply to residential leases and certain types of commercial leases. Including these debts can help you clear past financial obligations and start fresh.
Speak With A Chapter 13 Bankruptcy Lawyer Today
If you are struggling with debt in one of the categories above or another type of debt, filing for Chapter 13 bankruptcy may be the right path forward for you. To discuss your situation with a professional and receive assistance with the process of filing for bankruptcy, contract an attorney today.
