Will bankruptcy get rid of all my debts?

October 22, 2018

Question: Will bankruptcy get rid of all my debts?  

Bankruptcy is an amazing tool to help people out of a financial crisis.  It can relieve you of much of your financial obligations and it’s designed to give you a fresh start with life.

But bankruptcy will not necessarily eliminate all of your debts.  This depends in large part on what kinds of debts you have.  Let me explain.

Your typical bankruptcy discharge (that’s the piece of paper from the bankruptcy court that releases you from your obligation to pay certain debts) will eliminate the following types of debts:

  1. Credit Cards;
  2. Personal Loans;
  3. Medical bills;
  4. Cash advances;
  5. Utility bills (like your old cell phone bill or electric bill)
  6. Deficiencies for foreclosures of homes or repossessions of vehicles;
  7. Money owed on homes, vehicles, and other secured debts that you give back in the bankruptcy;
  8. Loans from family members;
  9. Fees to Professionals (like CPAs, attorneys, and the like).

But there are certain debts that bankruptcy will NOT eliminate, and there are some debts that if you want to eliminate you will have to file a lawsuit within the bankruptcy.

Which debts are not eliminated/discharged in bankruptcy?  What debts would you have to contest in order to not owe on them anymore?

-Nicole Johnson