Discharging Household Debt in a Personal Bankruptcy Filing
Household debt is rising — in Florida and across the United States. In fact, it has reached such highs, and so quickly, that a recent report from Business Insider describes it as an “explosion of household debt” that may leave the American economy metaphorically “running off the cliff.” Household debt here has now reached an all-time high, and commentators expect the total amount of nationwide household debt to continue to rise as inflation also ticks up. If you are among the many Floridians struggling with household debt, can you have this type of debt discharged in bankruptcy? Often, the answer is yes. Our West Palm Beach bankruptcy lawyers can tell you more about household debt and how you may be eligible to have these forms of debt discharged in your personal bankruptcy case.
What is Household Debt?
The term “household debt” refers to nearly any type of debt that a consumer borrows so that they can afford to cover various kinds of household expenses.
In general, household debt tends to include both installment loans (where you borrow money with set terms for repayment each month along with a specific interest rate and associated penalties or fees for late payments, such as mortgages) and revolving credit (where you borrow as needed and repay as you can, with credit card debt being the most common type of revolving credit but home equity lines of credit or HELOCs also fall into this category).
Having Household Debt Discharged in Bankruptcy
Household debt tends to fall into the categories of both secured and unsecured debt. While both forms of debt can be dischargeable in bankruptcy cases, if secured debts are discharged, the property securing the credit (such as a home or a motor vehicle) will typically be repossessed by the lender. Unsecured debts, such as credit card debt, can typically be discharged entirely in Chapter 7 bankruptcy cases, and it may be possible to have credit card debt discharged partially or in full in a Chapter 13 bankruptcy case.
Other forms of debt affecting households often include personal loan debt, medical debt, and student loan debt, and these types of debts may also be dischargeable in personal bankruptcy filings in Florida.
Contact Our West Palm Beach Bankruptcy Attorneys for Assistance Filing for Bankruptcy and Having Your Household Debt Discharged
Household debt in Florida and throughout the country is rising significantly, as we discussed, and many South Florida households are struggling to pay monthly bills and debts they owe. In general, household debt can be eligible for discharge in a consumer bankruptcy case, whether you are filing for Chapter 7 or Chapter 13 bankruptcy. If you have questions about the dischargeability of certain household debts, or other questions or concerns about consumer bankruptcy, an experienced West Palm Beach bankruptcy lawyer at Kelley Kaplan Delaney & Eller, PLLC can assist you. Contact our firm today to find out more about how we can assist you with your personal bankruptcy case and to get started on the documentation and paperwork to file your bankruptcy petition.
Sources:
law.cornell.edu/uscode/text/11
businessinsider.com/us-economy-warning-sign-household-debt-consumer-spending-savings-stocks-2026-6
