For many people, declaring bankruptcy is the beginning of a new chapter in their lives. It can be difficult to make the decision to declare bankruptcy, but most people who have done so state it was a very good idea.
However, not all debts go away as a result of filing a Chapter 7 bankruptcy. According to Findlaw, many debts like student loans, court fees, and child support are not purged by declaring a liquidation bankruptcy.
Understanding student loans
Many Americans are struggling under the weight of student loans. However, student loans are almost never dischargeable under a Chapter 7 filing. The only exception to this is if the court decides that paying back student loan debt constitutes an undue hardship.
This is generally very difficult to qualify for. In order to discharge student debts with a Chapter 7 filing, the debtor must show that even once the debtor goes through bankruptcy, he or she will not be able to pay the debt and will continue to be unable to pay the debt in the future.
Understanding additional non-dischargeable debt
The courts will not discharge any debt that has resulted from fraudulent or otherwise malicious acts on the part of the person filing Chapter 7. Any payments related to child support or general divorce settlement or agreements are also not generally dischargeable. In the event of debts that are directly related to divorce, the only way the courts discharge them is if paying the debt is more harmful to the debtor than the purported benefits to the recipient. Discharging these types of debts is complex and requires the assistance of an expert.