What debts does a chapter 7 bankruptcy get rid of?

Chapter 7 Gets Rid of DebtWondering what a Chapter 7 bankruptcy will get rid of? It can get rid of most or all unsecured debt that’s not a priority debt. This includes debts such as medical bills, personal loans, and most credit cards. Most tax debt cannot be wiped away.

However, there may be an exception to the rule if the tax debt is old and there is no lien on your property. Our bankruptcy lawyer can examine your tax debt and let you know whether a Chapter 7 or Chapter 13 would be the best way to help.

After filing a bankruptcy petition, the debtor will receive automatic relief or an automatic stay from their creditors. The relief prevents most creditors from contacting and continuing to collect debts like garnishments. In fact, a Chapter 7 can stop garnishments on credit cards, medical bills and personal loans.

You will not receive relief from all types of creditors and debt in a Chapter 7 bankruptcy. This type of bankruptcy will not stop a debt if it is a debt for a domestic support obligation such as past due child support or alimony. However, a Chapter 13 can stop a garnishment for a domestic obligation. Sometimes you may also place your arrearages into your Chapter 13 plan.

When you call our local bankruptcy attorney we can give you a free consultation over the phone and based on your debts, income, and property we can advise you accordingly. Whether a Chapter 7 or Chapter 13 is best, we can get it filed for you no matter where you live in Alabama.

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