Credit card debt is usually discharged in bankruptcy.
Apparently there is a rumor or a misunderstanding regarding credit card debt and the ability to discharge it through a bankruptcy filing. None of what I have heard is based in truth. That is why it is so important to speak with and experienced Kansas City Bankruptcy Attorney before making any personal decisions about bankruptcy as an option to eliminate your debt.
The truth about filing a Chapter 7 Bankruptcy in Kansas:
Debts that ARE Dischargeable:
•Auto accident claims
Debts that are POSSIBLY Dischargeable
•Property settlements or division of debts in divorce
•Willful and malicious injuries to others
•Debts incurred by fraud or dishonesty
•Debts arising from breach of fiduciary duty
In order for these debts NOT to be discharged, creditors must ask the court to make a determination about them. Without a request from the creditor and a granting of that request by the court, these types of debts will be discharged.
Debts that are NOT Dischargeable
•Trust fund taxes
•Child or family support
•Criminal fine or restitution
•Auto accident claims involving intoxication
•Debts not scheduled
•Penalties payable to the government other than tax penalties
•Debts listed in prior bankruptcy where debtor was denied a discharge
In general, the there are two types of debt that can be discharged — secured and unsecured. Secured would include items like your mortgage or car loan. Unsecured debt is debt that is not tied to any specific property. The most common kind of unsecured debt is credit card debt. Credit card debt is usually discharged in bankruptcy.
However, Credit card companies sometimes challenge the discharge in bankruptcy of debt owed to them, by claiming that the debt was fraudulently charged by:
•Submitting a fraudulent application
•Using the card without any intent to repay the debt
If you have run up your credit cards in the 2-3 months prior to filing for bankruptcy, it is likely you will have to pay those debts in full.
However, it depends on the specifics of each individual case. You can have your questions and debt issues addressed by our practiced attorneys. Call 913.438.1112 or email us today for your free consultation.