A bankruptcy discharge does not relieve a person of any government debts, such as taxes or student loans. It also does not exempt a person from any debts owed to a former spouse under the terms of a divorce decision.
After completing the requirements of the court, by order of the bankruptcy court, debts are discharged. The court’s order is known as a discharge order. The debtor’s legal obligation to pay the debts is removed by the discharge order. It also removes the creditor’s legal right to collect the debt from the debtor, implying that there is no legal commitment to the debt after the lawsuit is completed.
Debt, on the other hand, is not created equal. A nondischargeable debt is one that cannot be discharged in bankruptcy and must be paid in full, even if other debts are discharged. These debts include:
– Debts owed to the government, such as taxes or student loans
– Debts owed as part of a divorce decree
– Debts that are the result of a fraudulent act
– Debts that are the result of a personal injury caused by the debtor
– Debts for which the creditor has filed a lawsuit against the debtor
– Debts for which the debtor has filed a bankruptcy petition within the last six years
– Child support or alimony payments
Anyone seeking financial help or seeking debt relief should always seek the advice of an experienced Houston bankruptcy attorney. An attorney can help evaluate options and make the best choice of debt relief.