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Bankruptcy Information: What a Bankruptcy CAN?T Do

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Well, a lot of people seem to know what bankruptcy CAN do, but not everyone seems too familiar with what bankruptcy CAN?T do. In the long run, this sort of bankruptcy information can end up being more useful when deciding if filing for bankruptcy is right for you.

Bankruptcy Information: The Facts

First off, your filing for bankruptcy cannot protect a co-signer on a loan or other kind of debt. If you went half on a loan with someone, and the investment doesn?t pan out, you partner may have to file for bankruptcy too.

Another piece of valuable bankruptcy information is that it?s usually not possible to discharge any debts that were secured to creditors. When a creditor is said to be ?secured?, it means that the lender holds a legal claim on an asset that belongs to the borrower. In this scenario, the creditor has the right to seize the proceeds that result from a foreclosure. Also worth noting, secured creditors are always paid before any other unsecured creditors when doling out seized funds.

There are also some types of debt that cannot be discharged under just about any circumstance. Debts such as alimony, child support and other divorce related fees usually are not dischargeable. Also, loans where the government is involved, such as student loans, criminal fees and court restitution are still liabilities even after filing bankruptcy. Some taxes may also be off limits. While there are some exceptions made in the court of law, they are very rare, and you should not expect to have any of these sorts of debts discharged through a bankruptcy.

What This Bankruptcy Information Means for You

While there are generally exceptions to the above mentioned rules, it?s helpful to know that for the most part these standards are absolute. Be sure you?re not filing for bankruptcy with the hopes of discharging an inescapable debt. For more bankruptcy information, please browse the rest of our site and speak with a Legal Helpers attorney.

Full post as published by Consumer Bankruptcy Blog from Legal Helpers on July 10, 2009 (boomark / email).