FAQs About Undischarged Debts In A Bankruptcy Claim

by | Oct 20, 2016 | Lawyers

In Arizona, consumers gain the right to acquire a discharge for specific debts if they file for bankruptcy. The court defines what debts are eligible for this benefit. The consumer must fulfill their obligations outlined in their claim to achieve the discharge. The following are FAQs about undischarged debts in a bankruptcy claim answered by Attorneys Chandler AZ.

What Does Undischarged Debt Mean?

In terms of bankruptcy, an undischarged debt refers to debts that aren’t eliminated through these claims. The local bankruptcy laws prohibit the court from discharging the debts and exonerating the consumer from this responsibility. Even if the debts aren’t included in the bankruptcy claim, the consumer must pay them off or face consequences.

Why aren’t Child Support and Alimony Payments Discharged?

Child support and alimony are awarded through a court order. They aren’t classified as consumer debt. If a consumer fails to fulfill this legal obligation, they face penalties for violations. The bankruptcy court cannot provide any protection against legal action taken by a former spouse to collect these payments. All court orders related to these assignments are enforced through family court.

What Debts Associated with Criminal Infractions aren’t Discharged?

Any outstanding balances related to a criminal infraction such as restitution or fines aren’t discharged during a bankruptcy. If the consumer owes money due to a lawsuit, they remain responsible for payment. Any overdue balance related to these payments are managed in civil or criminal court.

When are Student Loans Discharged?

The only time in which student loans are discharged during a bankruptcy is if they produce a financial hardship. The consumer must provide clear evidence of this hardship and all deferments or forbearances that apply to the loans.

Are There Any Other Debts that Cannot be Discharged?

Any overdue income tax payments or debts that weren’t included in the claim are not discharged. The state and federal IRS have the right to seek payment of overdue taxes regardless of a bankruptcy status. Creditors can take legal action for debts that weren’t included in the claim.

In Arizona, bankruptcy provides financial assistance for consumers. These claims enable them to reorganize debts or liquidate their assets to achieve a settlement. During these claims, a discharge is available for eligible debts. Consumers who need more answers about discharged debts contact Attorneys Chandler AZ or Visit Site today.

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