What debts can and cannot survive a Chapter 13 bankruptcy?
When you’re facing tough financial times and thinking about Chapter 13 bankruptcy in Oklahoma, it’s essential to understand what a nondischargeable debt is. This debt cannot be wiped out in bankruptcy, and dealing with it can be challenging. That’s where our attorneys at Scott Harris Law, PLLC, in Oklahoma City, OK, come in.
We are here to help you understand and navigate the complexities of nondischargeable debt in Chapter 13 bankruptcy. In this article, we’ll simplify the concept of nondischargeable debt, explain what it means, and highlight why having an experienced attorney from Scott Harris Law, PLLC, on your side is critical.
What is Chapter 13 Bankruptcy?
Chapter 13 bankruptcy, also known as a “wage earner’s plan,” is a special kind of bankruptcy for individuals with steady incomes who want to get their finances back on track. In Chapter 13, you work with the court to make a payment plan you can handle. This plan usually lasts three to five years and lays out how you’ll pay back your creditors, whether they are for things like your house (secured debts) or credit cards (unsecured debts).
What are the Advantages of Chapter 13 Bankruptcy?
A key benefit of Chapter 13 bankruptcy is that it stops foreclosure or repossession for you to catch up on late payments. It also makes creditors stop trying to collect money immediately, giving you some breathing room. While you might get rid of some debts when you finish the plan, child support, alimony, and specific taxes must be paid in full. Chapter 13 gives you a definite way to deal with your debts and an opportunity to start fresh with your finances.
What are Debts Covered by Chapter 13 Bankruptcy?
Chapter 13 bankruptcy can help you discharge different types of debts:
- Secured Debts: These are debts backed by things like your home or car. Chapter 13 lets you catch up on missed payments and keep your property if you follow the repayment plan.
- Unsecured Debts: This includes debts like credit cards and medical bills. Usually, you don’t have to pay them in full, and the rest might go away once you finish the plan.
- Priority Debts: These are critical debts like taxes and child support. You must pay them all in the Chapter 13 plan, but you can do overtime without extra charges.
- Nonpriority Unsecured Debts: These are debts like older taxes and personal loans. You pay them based on how much money you have left after your living costs, and whatever’s left at the end of the plan might be gone.
What is Nondischargeable Debt in Chapter 13 Bankruptcy?
In Chapter 13, nondischargeable debt are certain debts that can’t be erased or discharged through bankruptcy. Although Chapter 13 lets you plan to pay off many debts, some obligations are seen as exceptions and must still be repaid, even after you finish your bankruptcy.
What are Examples of Nondischargeable Debts?
Nondischargeable debt in Chapter 13 bankruptcy in Oklahoma comes in various categories, each with unique rules. Remember these categories for a smoother bankruptcy process:
- Priority Debts: These debts cannot be discharged and come first in your Chapter 13 plan. They often include specific taxes, child support, alimony, and certain government fines.
- Secured Debts: These debts, like mortgages and car loans, can be tricky. While your liability may be discharged, the creditor’s property right remains. So, if you want to keep the property, you must keep paying.
- Student Loans: They are usually nondischargeable unless you can prove “undue hardship,” which is challenging but not impossible with help from our experienced attorney.
- Criminal Restitution: Owing restitution from criminal convictions cannot be discharged.
- Fraudulent Debts: Debts from fraud or misrepresentation typically cannot be discharged.
- Certain Tax Debts: Recent income taxes are usually nondischargeable, but our attorney can help you understand the details and deal with tax debt challenges.
What Happens if I Am Unable to Settle My Nondischargeable Debts?
Not resolving a nondischargeable debt in Chapter 13 bankruptcy can bring severe repercussions. Creditors may persist in collecting through wage garnishment, property liens, and legal actions, causing financial strain and potential asset loss. Failing to meet your Chapter 13 repayment plan also could lead to bankruptcy dismissal, leaving you accountable for all debts.
Collaborating with our competent attorney is vital to effectively handle nondischargeable debts, explore negotiation options, and fulfill your obligations, preventing these unfavorable consequences.
Can a Bankruptcy Lawyer Help Me With Nondischargeable Debts?
Dealing with the complexities of nondischargeable debt in Chapter 13 bankruptcy in Oklahoma is incredibly tough without professional help. Here’s why our attorney is your essential partner in this process:
- Assessing Nondischargeable Debt: Our attorney can review your financial situation and pinpoint which debts cannot be discharged. That ensures your repayment plan follows the law and is accurate.
- Negotiation and Mitigation: Sometimes, you can negotiate with creditors to lower or restructure nondischargeable debt. Our lawyer can stand up for you and work toward favorable agreements.
- Undue Hardship for Student Loans: If you believe you meet the “undue hardship” standard for getting rid of student loans, our attorney can help you build a strong case and present it effectively to the court.
- Protecting Your Interests: Our attorney will be your advocate throughout the bankruptcy process. We will handle dealings with creditors, the bankruptcy trustee, and the court, ensuring your interests are safe.
- Maximizing Debt Relief: Our lawyer works to get you the most out of Chapter 13 bankruptcy. That includes guaranteeing eligible debts are in your repayment plan and managing secured debts properly.
- Avoiding Common Mistakes: Going through bankruptcy alone can lead to expensive errors. Our attorney’s experience helps you avoid these pitfalls to make your journey to financial recovery smoother.
Give Our Chapter 13 Bankruptcy Lawyers a Call Today!
When dealing with nondischargeable debt in Chapter 13 bankruptcy in Oklahoma, having a reliable attorney by your side is the key to a successful fresh financial start. At Scott Harris Law, PLLC, we are your trusted partner for addressing nondischargeable debt in Chapter 13 bankruptcy. We provide a free consultation to clients seeking our services in Oklahoma City, OK, and other areas.
Don’t face these challenges alone—call us for assistance and start your journey to financial stability today. We also offer additional legal services, including credit card debt, foreclosure defense, and debt negotiation.