What Debts Are Typically Non-Dischargeable?

When you file Chapter 7 bankruptcy, not all of your debts may be eliminated.  For example, student loans, recent taxes, parking tickets, child support and debts incurred through fraud are not eliminated.  The video below talks about how some people will run up the balance on a credit card in anticipation of filing Chapter 7 bankruptcy.  This is a huge mistake as credit card issuers can bring a complaint within the bankruptcy case to have that particular debt held non-dischargeable.  The best advice is to see an attorney as soon as you are experiencing financial problems.  By do so, the attorney can advise you as to what is proper and what is improper under the bankruptcy code.


Jesse Barrientes:
What typically then are the types of debts that are not dischargeable?  I think you hit on a couple of them, student loans and some other things there, too.


David Siegel:
Well, the big non-dischargeable debts are student loans, recent taxes, parking tickets, child support, maintenance payments, debts owed to a municipality in the way of a fine or a fee and then of course, debts incurred by fraud.  I want to talk about this briefly, too.  A lot of people have credit card debt.  And they get this great idea they think that if they’re going to file but for bankruptcy, they are going to max out those cards, take it to the limit and then go see a bankruptcy attorney and file.  Well, the credit card companies are very smart.  They know when you filed, they know when you’ve made your last purchase, they know where, how much and for what type of service.  If you run up the card or take a huge cash advance in anticipation of filing, that credit card merchant can bring an adversarial complaint to hold recent charges non-dischargeable.  And that means you are going to owe that going forward even after you do your bankruptcy.  So be very careful about using your credit card for any major purchases, any non-necessity basically, too close to filing a bankruptcy.

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