How To Avoid Holiday Debt? Salt Lake City Bankruptcy Attorney (2024)

FAQs

Which type of debt is the most difficult to discharge via a bankruptcy? ›

Student loan debt is generally considered to be the most difficult type of debt to discharge via bankruptcy. Student loan debt can only be discharged in rare circ*mstances and typically requires a showing of undue hardship, which is difficult to prove.

It has helped more than 500,000 people located all over the United States settle their debt. More than $1 billion in unsecured debts resolved — one of the larger amounts of debt settled that we've come across. Like others on our list, National Debt Relief has an A+ BBB rating, the highest possible score.

Debt relief can involve consolidation and debt counseling, which involves lowering the cost of repayment but also debt settlement which involves repaying less than is owed in a negotiated settlement with lenders. Bankruptcy involves seeking protection from creditors for debt that can not be repaid.

Key Takeaways. Types of debt that cannot be discharged in bankruptcy include alimony, child support, and certain unpaid taxes. Other types of debt that cannot be alleviated in bankruptcy include debts for willful and malicious injury to another person or property.

Most people opt for Chapter 7 bankruptcy when available because it works the fastest, usually taking about four months to complete. It wipes out qualifying debts but doesn't help you with other issues, such as saving a home from foreclosure, a car from repossession, or paying nondischargeable debts over time.

Filing for bankruptcy doesn't automatically freeze your bank accounts on its own. However, certain banks and credit unions will freeze accounts if you file for bankruptcy to protect the bankruptcy assets.

Unfortunately, there is no such thing as a government-sponsored program for credit card debt relief.

What is Emergency Debt Relief? Emergency debt relief is there to help halt or reverse the negative aspects of having debt. The form of debt relief that closest fits this description is bankruptcy. Filing for bankruptcy can have an immediate effect on debt related actions in progress.

Bankruptcy Eliminates Credit Card Balances and Most Other Nonpriority Unsecured Debts. Bankruptcy is very good at erasing most nonpriority unsecured debts other than school loans. The debt is unsecured if you didn't promise to return the purchased property if you failed to pay the bill.

Some will agree to settle your debt for as little as a third of the total, while others will try to get as much as 80% of the debt paid. You may choose to start your negotiation by offering to pay a low percentage of the total debt — such as around 25% — and negotiate from there.

Will I still owe money after bankruptcy? ›

Not all debts are discharged. The debts discharged vary under each chapter of the Bankruptcy Code. Section 523(a) of the Code specifically excepts various categories of debts from the discharge granted to individual debtors. Therefore, the debtor must still repay those debts after bankruptcy.

Loans, medical debt and credit card debt are generally all able to be discharged through bankruptcy. Tax debt, alimony, spousal or child support and student loans are all typically ineligible for discharge.

The order of claims in bankruptcy starts with creditors who provide services or goods after bankruptcy is filed. Post-petition administrative claims—that is, creditors whose claims arose after the debtor filed for bankruptcy, for the actual and necessary costs of preserving the estate—usually have first priority.

Chapter 7 Bankruptcy. According to the U.S. Courts, the purpose of Chapter 7 bankruptcy is to clear most if not all of your debt in a relatively short time frame. The large majority of people filing Chapter 7 are able to exempt or retain all of their assets.

Priority Debt Gets Special Treatment in Bankruptcy

Congress decided that all unsecured debts are not created equal and that some should be paid before others. So, under the bankruptcy code, creditors get priority treatment if money is owed to the government or when it's in the interest of the overall public good.