Filing for Chapter 7 bankruptcy is a way for people overwhelmed with debt to get a fresh start on their finances. A debt discharge under Chapter 7 releases the debtor from personal liability for most debts. However, there are some debts that do not fall into this category. Depending on the circumstances, there are some bills that you must (or should) continue to pay.
The basic Chapter 7 timeline is as follows:
- Mandatory credit counseling
- Filing of papers to begin the bankruptcy process
- Creditors’ meeting held about a month after the papers are filed
- Mandatory budge counseling within 60 days of the creditors’ meeting
- 60 days after the creditors’ meeting the court will send a written discharge of your debts
For most debtors the discharge order wiping out debts will be entered automatically. Once the discharge has occurred, creditors cannot initiate or continue any actions against the debtor to collect a discharged debt. This includes telephone calls, letters, and any other personal contact.
The following debts may not be discharged under Chapter 7:
- Alimony and child support
- Educational loans made or guaranteed by the government
- Debts for willful or malicious injuries to another person or another person’s property
- Debts involving death or personal injury resulting from the debtor’s operation of a motor vehicle while intoxicated
- Debts for certain criminal restitution orders
- Debts the debtor did not set forth in the bankruptcy filings to the court
- Debts owed to certain tax-advantaged retirement plans
- Debts for certain condominium or cooperative housing fees
It’s worth noting that the debt discharge under a Chapter 13 bankruptcy is slightly broader than Chapter 7. The following debts may be dischargeable under Chapter 13, but not Chapter 7:
- Debts for willful or malicious injury to property
- Debts involving property settlements in divorce or separation proceedings
If you would like to discuss your situation with one of our licensed bankruptcy attorneys, our doors are wide open. We offer free consultations to people throughout the state of Oregon, and we also have offices in Vancouver, and Tri-Cities in Washington. To schedule an appointment, send us a message through our contact page.