A lien allows the creditor to repossess and sell the collateral to recover at least some of the money you borrowed if the debt remains unpaid—even if the court discharged the debt in your bankruptcy case. Some liens can be removed, however, even after the closure of the bankruptcy karacto.xyz: Cara O'neill, Attorney. Mar 13, · Debts that can be discharged and the amount of the discharge all depend on whether you file Chapter 7 or Chapter 13 bankruptcy. In Chapter 7 bankruptcy, the trustee divides your nonexempt assets among your creditors, and any remaining debt will be discharged. In Chapter 13 bankruptcy, you enter a repayment plan that repays all or most of your debt. Dec 27, · You'll usually be discharged from your bankruptcy order after 12 months, provided you haven't behaved irresponsibly. If you've not co-operated during your bankruptcy it could last much longer than a year. Discharge will usually happen automatically on the anniversary of your bankruptcy.
Related videosThe bankruptcy discharge - how it protects you
If you've received a bankruptcy discharge and do not see a record of it in your credit reports, you can request an update to your credit reports with the three main credit bureaus Experian, TransUnion and Equifax. To process this update with Experian, you'll be required to provide a "schedule " document from your bankruptcy records to show evidence of the debts included in your discharge. If you're not sure what appears in your credit file, consider getting a free copy of your credit report and score from Experian to see what's recorded in your credit history.
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Chapter 13 allows some debts to be discharged that can't be discharged in Chapter 7. It includes marital debts created in a divorce agreement exclusive of spousal support or alimony , court fees, certain tax-related debts, condo and homeowners' association fees, debts for retirement loans, and debts that could not be discharged in a previous bankruptcy.
Debts that can be discharged and the amount of the discharge all depend on whether you file Chapter 7 or Chapter 13 bankruptcy. In Chapter 7 bankruptcy, the trustee divides your nonexempt assets among your creditors, and any remaining debt will be discharged. In Chapter 13 bankruptcy, you enter a repayment plan that repays all or most of your debt.
At the end of your repayment plan, the remaining debt will be discharged. Debts that are likely to be discharged in bankruptcy include credit card debts, medical bills, lawsuit judgments, personal loans, obligations under a lease or other contract, and other unsecured debts.
However, that cannot be discharged in either type of bankruptcy. Section a of the Bankruptcy Code describes the types of debt that may not be discharged. It is extremely difficult—if not impossible—to discharge student loans in bankruptcy. However, some debts cannot be discharged under Chapter 13 bankruptcy, including the following:. According to the United States Courts, discharge for Chapter 7, bankruptcy usually occurs about four months after the date you file your bankruptcy petition.
Once your debts have been discharged, a copy of the order will be mailed to all your creditors as well as the U. This order includes a notice that creditors should not attempt to collect on the debts or else they face punishment for contempt. Make sure you keep a copy of the order of discharge along with all the other bankruptcy paperwork, so you're not charged to get a copy later on.
Even though you are under no legal obligation to do so, you may voluntarily repay any debts that have been discharged through your bankruptcy. If a creditor attempts to collect a discharged debt you should provide the creditor a copy of your discharge and inform them in writing that the debt was discharged through your bankruptcy. If the creditor files a lawsuit on a discharged debt you should immediately inform the court that the debt was legally discharged.
A judgement entered on a discharged debt can be voided but this can be costly and require the services of an attorney. Once your debts have been discharged, you should make a plan to improve your credit score so that, in the future, you will be able to obtain credit on favorable terms.