San Jose Bankruptcy Attorney Talks About Non-Dischargeable Debts
San Jose Bankruptcy Attorney Talks About Non-Dischargeable Debts
Any person in Bankruptcy or researching bankruptcy has probably discovered that Bankruptcy is not the scary life ending event that has been portrayed in the media. In fact, they have probably discovered that Bankruptcy is a government approved way to discharge (legal term for get rid of completely) most of their debts. For example, a debtor may expect that their $50,000.00 credit card debt will be wiped away completely without any expectation to ever repay that money. Ever. Given the finality and ease of bankruptcy (if you have an attorney) it is easy to see why the creditor fuel media tries to give bankruptcy a bad image.
However, tougher new bankruptcy laws have made certain debts non-dischargeable. What that means is that certain debts will survive the bankruptcy and the Debtors will still owe them. While the list is not that extensive, a little common sense will show that these are the kind of debts that the public, as a whole, would not want a debtor to just do away with.
Some examples of non-dischargeable debts are certain taxes and fines. The government will not “reward” a person for failing to pay their income taxes because it encourages cheating the government. Debts created through fraud, false information to a creditor, or malicious injury. If a Debtor lied to get the money or meant to hurt somebody, the government will not provide that debtor with a pass for the money they received. This includes injury due to drunk driving. Alimony and child support survive a bankruptcy because that money is meant to support an exspouse or the Debtor’s children. If the Debtor did not pay the money, then the State may have to pay through welfare which is not good for anybody. Therefore no pass for the Debtor.
While the examples above make sense from a social standpoint, there are a few odd exceptions. One example is student loans. Due to skewed politics, the 2005 change in bankruptcy laws prevents the discharge of all student loans. The true oddity is that the US encourages people to go to college as a means to get ahead in life but disallow the discharge of student loans if the “getting ahead” failed. Student loans are also extremely easy to obtain as a Student does not need a job or employment history (which is needed for all other loans) but there is no relief if a student debtor who has never held a job realizes that they cannot make ends meet. Finally, Student Loans are usually acquired when a person is extremely young so they can best take advantage of the “fresh start” promise of a bankruptcy which is now denied and the Student Debtor must look forward to 30 years of bad credit, collections, or lawsuits. Isn’t college great?
If you have a question regarding Bankruptcy please contact Sagaria Law at 1-800-941-6730 for a free consultation or visit us at www.sagarialaw.com. Our team of Bankruptcy Lawyers can assist you with all aspects of your case. We specialize in Chapter 7 bankruptcy, Chapter 11 bankruptcy, Chapter 13 bankruptcy, lien stripping, etc. Call today for your free consultation. We have attorneys in San Mateo, Fremont, Salinas, Sacramento and San Jose.
