Adapted from an article by Nathan Knightley
Recent modifications to laws related to bankruptcy have made it more difficult for an individual to apply for bankruptcy. The law is quite complex and there are a lot of caveats, which exclude certain types of debts from being erased. Let’s take a look at some examples and guidelines.
Not all debt is eliminated in a bankruptcy.
According to the new bankruptcy laws the following debts are not satisfied by bankruptcy proceedings:
- Home mortgage
- Government funded or guaranteed loan for education
- Any owed alimony or child support
- Debts owed for injuries or death as a result of a DUI
- Condominium fees
- Tax claims
- Any order to pay restitution as the result of a crime
If the majority of your debt is attributable to one or more of these situations, bankruptcy will do little to help you. If, however, your debt consists of elements outside of these, you may be in luck. Visit an attorney to have your questions answered.
A lot of individuals facing bankruptcy erroneously believe that they can keep their vehicles, which are financed when your transportation if essential. This is not true anymore. If you have two vehicles for your household which are financed, the loan company can repossess both vehicles. The bankruptcy proceedings in and of themselves will not protect you. For this, you need to have the advice of counsel.
Can I keep my car?
It depends. Your creditors can challenge you in a separate court proceeding on a debt which they believe they should be permitted to collect, regardless of the bankruptcy. To validate their claim, they can sue you, costing you more money and the risk that you will be stuck with this debt.
Once the bankruptcy is done, am I in the clear?
Protect your family by having your attorney review the situation and plot the proper course of action. Consultations are very reasonable and most attorneys will entertain meeting times that will coincide with your work schedule. In short, there are no reasons not to call immediately.
