Understanding Non-Dischargeable Debts in Bankruptcy
Good afternoon everybody, Edward Kelley here, your Oklahoma bankruptcy lawyer with another 3 Minutes to Financial Freedom. Today we’re going to talk about what debts are non-dischargeable.
Most debts are, but some you cannot get rid of in bankruptcy, so we’re going to quickly go through the list of the most common.
Non-Dischargeable Debts:
Number one, student loans. The government protects itself. Cannot discharge those, and by student loans I mean those backed by the federal government. You just took out a loan and used it for tuition or books. That’s not a student loan, that’s just a loan, but if you went through FAFSA, if you went through the federal government and the government loans you the money, they’re not going to let you discharge it.
Second, child support. That one makes sense, obviously. That is never dischargeable in bankruptcy.
Most court fines and restitution are not going to be dischargeable in bankruptcy, although there are some civil penalties that may be dischargeable in bankruptcy. We’ll talk about that in another video.
Also, there are debts that can be deemed non-dischargeable for purposes of fraud. Judgments for DUI-related tort claims. For example, if you’re convicted of a DUI and somebody was injured and they get a civil judgment against you, that’s not going to be dischargeable because of the alcohol use.
If somebody files what’s called an adversary proceeding against you in your bankruptcy, they can have debts that normally would be dischargeable declared dischargeable if they can prove, for example, fraud or willful or malicious behavior. They have to go to some trouble to do that, and they don’t always. We’ll talk about that in another video.
How to Tackle Non-Dischargeable Debts:
In essence, if you have played a trick on somebody or done something malicious in incurring a debt, the person you owe money to can raise that in bankruptcy and try to have that debt taken back out to where you still owe it afterward.
Again, just to summarize, debts that are not dischargeable, student loans backed by the federal government, child support, court fines, and restitution, and debts that are deemed based on fraud or willfully malicious behavior.
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If those are the majority of your debts, you may still have a problem. There are certainly other ways to tackle those. As always, you can reach me at oklahomacitybankruptcyattorney.pro for a free consultation.