Understanding the Various Types of Debt in Oklahoma
Types of Debt
Good afternoon, everybody. Edward Kelly, your Oklahoma bankruptcy attorney here. Today we’re going to answer the question, or we’re going to go over the topic, a comprehensive review of all types of debt in Oklahoma.
So I’m going to rapid fire this so we can stay in our three minutes. What types of debt have we got? Well, we’ve got first general overarching division of secured and unsecured. As you probably can guess, unsecured means there’s no collateral. Credit cards, medical bills, you know, these are just debts on the honor system. You’re going to pay them. And, of course, they have the recourse of taking you to court. That is, if you don’t file bankruptcy, the bankruptcy is going to trump that. But there’s no security. There’s no car back in the note. There’s no house. There’s no personal property. Unsecured. Secured means there is some type of collateral. So most often a home mortgage, a car note, or potentially a UCC filing. They call it the Uniform Commercial Code, which can attach to, for example, tractors or other personal property. It can really be almost anything. But if that’s filed, then those are considered definitely secured.
So what about beyond that? So there’s also priority and non-priority. So, for example, tax debt is given a priority. It may be unsecured, but it’s a priority debt. Tax debt owed to the IRS or states that is three years or younger, incurred in the last three years, not dischargeable. It’s a priority unsecured. And there can be priority secured. Some IRS debt, they’ve already filed tax liens. That becomes priority secured because perhaps there’s a lien on your home that makes it secured.
Understanding Dischargeable and Non-Dischargeable Debt
Last thing I’ll talk about is dischargeable and non-dischargeable debt. We’re going to go more into this tomorrow about what debts are dischargeable. But some debts can be disposed of in bankruptcy and some can’t. And again, I’m going to go into detail on which ones can’t tomorrow. But, you know, you want to be sure before you file that at least a majority of the debt that you have is dischargeable, or I shouldn’t say a majority, if there’s enough dischargeable debt to justify the bankruptcy. Even if you leave a lot of non-dischargeable debt, you may still want to do a bankruptcy to get rid of the dischargeable so you can focus on the non-dischargeable.
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As always, you can reach me at oklahomacitybankruptcyattorney.pro for a free consultation.