What Debts Are Eliminated With Chapter 7 Bankruptcy?

The typical debts that are eliminated with Chapter 7 bankruptcy include credit cards, medical bills, personal loans and more.  The transcription and video below explain what is eliminated in greater detail.

Jesse Barrientes:   What debts are typically eliminated with the Chapter 7?

David Siegel: Well, a Chapter 7 is going to eliminate typical unsecured debt such as credit cards, medical bills, personal loans, past due utility bills, auto repossession deficiencies, foreclosure deficiencies.  The majority of someone’s debt under Chapter 7 is going to be eliminated.  Now, there are some exceptions; student loans, recent taxes, parking tickets, child support, maintenance payments, debts incurred by fraud, debts incurred based on DUI driving if you injure somebody.  Ironically, you can get out of the debt to the car but you can’t get out of the injury to the person if you are driving DUI.  So there’s a little bit of a distinction there.  It’s not that the total debt is dischargeable, just the injury portion.

But for the overwhelming majority of clients or people who I see every day, most of their debt is being eliminated.  They are getting a nice, fresh start.  They are getting to breathe again; they are getting to live their life again like normal citizens without that burden of the creditor always at the door.