When facing overwhelming debt, bankruptcy can offer a beacon of hope for a financial fresh start. In South Carolina, filing for bankruptcy, particularly Chapter 7, allows many debts to be discharged, meaning they are effectively forgiven. However, it’s crucial to understand that not all debts are eligible for discharge. This post aims to clarify which debts can be discharged in a South Carolina bankruptcy and which remain your responsibility.
What Does Debt Discharge Mean?
Debt discharge in bankruptcy means the court legally erases your obligation to pay certain debts. This allows you to rebuild your finances without the burden of past debts weighing you down. However, it’s essential to know that the bankruptcy court has the power to forgive many but not all debts.
Debts That Can Be Discharged
Generally, unsecured debts are often eligible for discharge in a Chapter 7 bankruptcy. These may include:
- Credit card debt
- Medical bills
- Personal loans
- Other unsecured debts
Debts That Are Never Discharged
Despite the possibility of discharging many debts, some obligations remain, regardless of your financial situation. These debts are not forgiven and will still be your responsibility after bankruptcy:
- Alimony:Â Spousal support payments remain in place, and any arrears will still be owed.
- Child support:Â Like alimony, child support payments are not dischargeable, and any back payments must be paid.
- Tax debt:Â Back taxes are not forgiven by bankruptcy. You will still owe the IRS and other tax authorities.
- Court-ordered injury settlements:Â If you are required to make payments due to a court-ordered injury settlement (e.g., from a car accident), those payments will not be discharged.
- Debts not included in your filing:Â Any debt you fail to declare during your bankruptcy filing will not be forgiven.
Finding Help with Your Debt
If you’re struggling with debt and considering bankruptcy, it’s crucial to seek the advice of an experienced South Carolina bankruptcy attorney. They can help you understand which debts may be discharged and explore the best course of action for your specific situation.
Though some debts may not be forgiven by filing for bankruptcy, many can be. If you’re feeling like you’re underwater on your debt and want a clean financial start, don’t wait. Contact Lam Law Firm today to schedule a consultation with an experienced South Carolina bankruptcy attorney.
