Which Debts Survive Bankruptcy?

Did your bankruptcy case recently come to a close, and have you been under the impression that your debts were discharged such that you now have a fresh start? Whether you filed for a type of reorganization bankruptcy and spent years making payments to catch up with many of your creditors while having some unsecured debts discharged at the end of your case, or you filed for Chapter 7 bankruptcy and received a discharge within months of filing your bankruptcy petition, you may be surprised to learn that you are still receiving bills for debts that you did not expect to owe.

In some cases, creditors or debt collectors violate the law and continue to take steps to collect on debts that were discharged in a bankruptcy case and for which a debtor is no longer liable. In other situations, however, it may be that certain debts for which you were liable survived the bankruptcy. Which debts survive a bankruptcy filing, and what does that mean for you? Our West Palm Beach bankruptcy attorneys can explain.

What Does It Mean for a Debt to “Survive” a Bankruptcy Case?

When a debt “survives” a bankruptcy case, it simply means that the debtor is still liable for the debt, and that the debt still exists.

Debts can survive bankruptcy cases for many different reasons, and it is important for any debtor to seek legal advice ahead of time about whether they can expect to come out of a bankruptcy case still owing any debts, or if they will be entirely caught up with creditors through their reorganization bankruptcy or if they will receive a discharge of debts.

Why Debts “Survive” Bankruptcy Filings

There are a number of different reasons that a debt might survive your bankruptcy case while other debts are discharged, including the following:

• Debt is nondischargeable as an “exception to discharge” under the US Bankruptcy Code, such as family support debts and certain tax debts;
• Debt was considered a “luxury” purchase or service charged on a credit card in the period shortly before the bankruptcy filing, and thus the debt was not discharged; or
• Debtor reaffirmed the debt during the bankruptcy case, agreeing to remain liable for the debt, which may occur when a debtor has a debt with a co-signer or when a debtor wants to retain a secured asset such as a motor vehicle.

You can lawfully receive bills — and owe them — for debts that actually survive your bankruptcy, but you are not liable for discharged debts that creditors or debt collectors are unlawfully attempting to collect.

Contact a West Palm Beach Bankruptcy Attorney Today for Assistance with Any Debts That Survived Your Florida Bankruptcy Case

While many debtors file for bankruptcy with the expectation that they will have a fresh start or a clean slate, financially speaking, there are certain types of debts that are nondischargeable regardless of the circumstances, and in some cases, particular debts may not be discharged in a bankruptcy case for many different reasons. These debts survive the bankruptcy case, and the debtor is still liable for them at the end of the case — even if most or all other remaining debts were discharged. If you have any questions or concerns about the dischargeability of your debts, it is important to seek legal advice so that you have a clear picture of what to expect at the end of your case. One of the experienced West Palm Beach bankruptcy lawyers at Kelley Kaplan Delaney & Eller, PLLC can answer your questions today. Contact us for assistance with your South Florida bankruptcy filing.

Source:

law.cornell.edu/uscode/text/11