If you are overwhelmed with bills and need to wipe out debt you should talk to an attorney about bankruptcy. Chapter 7 or Chapter 13 can be an effective tool to wipe out debt in bankruptcy. If a debt is discharged in bankruptcy the borrower (debtor) will be released from personal liability on the debt. Further, the discharge prohibits a creditor from taking any collection action against the borrower. However, there are many nuances of bankruptcy law which can prevent a discharge of certain debts. Therefore, it is important to seek counsel from a bankruptcy law firm in Tampa before taking action. There may be potential pitfalls to bankruptcy you would not be aware of without competent legal counsel.
Wipe Out Debt with Chapter 7 Bankruptcy
Bankruptcy law provides for different rules of discharge in Chapter 13 and Chapter 7 bankruptcy to wipe out debt. This article will discuss using a discharge of debts in a Chapter 7 bankruptcy to wipe out debt. Chapter 7 is a liquidation bankruptcy, which means a debtor may be required to sell certain assets as a condition of the bankruptcy. On the other hand, Chapter 13 is a restructuring bankruptcy, instead of selling assets to pay creditors you create a payment plan to pay back the amount owed. For more information on Chapter 13 bankruptcy click here or call us to speak with a bankruptcy attorney in Tampa.
Requirements to Wipe Out Debt in Chapter 7 Bankruptcy
In order for a debt to be eligible for discharge in bankruptcy, the debt must have been originated prior to filing the bankruptcy petition. In addition, the debt must be listed on the bankruptcy petition. If the debt is not included it will not be eligible for a discharge, even if it was originated prior to the bankruptcy filing. Thus, debtors should meticulously review all accounts with their bankruptcy lawyer prior to filing the bankruptcy petition to ensure all the debts are included. Unfortunately, satisfying this condition alone is not enough to ensure you will wipe out debt in bankruptcy. There are numerous grounds for the court to deny a discharge in Chapter 7, these include but are not limited to:
- Actions by the debtor to conceal, mutilate, falsify or destroy documentation evidencing the debtor’s financial condition or transactions. See §11 U.S. 727(a)(3)
- Failing to preserve documentation evidencing the debtor’s financial condition or transactions. However, if the lack of preservation was justified under the circumstances the discharge will not be denied.
- Knowingly and fraudulently making a false oath or presenting/ using a false claim.
- Personal injury lawsuits stemming from driving under the influence of drugs or alcohol.
- Transferring property or incurring debt within the 2 years preceding bankruptcy and the debtor:
- Intended to hinder, delay, or defraud a creditor; or
- Received less than a reasonable equivalent of value in exchange for the transfer or a debt obligation incurred; and
- was insolvent on the date that the transfer was made, or became insolvent as a result of the transfer; or
- intended to incur, or believed that the debt incurred would be beyond the debtor’s ability to pay
Bankruptcy Law Firm in Tampa
If you are having a difficult time meeting your financial obligations Florida Law Advisers, P.A. may be able to help wipe out debt in bankruptcy. Our Tampa bankruptcy lawyers have years of experience helping people just like you solve their financial problems and obtain a fresh start. We will help ensure your rights are protected, keep you well-informed every step of the way, and help you receive the utmost protection bankruptcy can offer. To schedule a free consultation with a Tampa bankruptcy lawyer at our firm call, email, or fill out an online inquiry on our website today