Discharging Debt through Chapter 13 Bankruptcy

In Chapter 13 bankruptcy as in Chapter 7 bankruptcy, a debt discharge is a desirable outcome for most debtors. Discuss your particular financial circumstances with an experienced bankruptcy attorney to determine whether Chapter 13 is the right option for you and how to discharge your debts.

At Prescott Pearson & Tande, PA, we have been helping Minnesota clients find debt relief solutions through Chapter 13 bankruptcy and other options for more than 40 years. Talk with an attorney from our firm to discuss your options in a free consultation.

Chapter 13 Bankruptcy Involves Debt Reorganization and a Repayment Plan

Fundamentally, a Chapter 13 bankruptcy involves debt reorganization and repayment as its main feature. Past-due mortgage payments, credit card debts, medical bills and other unpaid debts are consolidated and a debtor repays a portion or all of the debt in affordable monthly payments over a three- to five-year period. At the end of the repayment period, any debt that still remains is discharged.

What Types of Debts Are Dischargeable?

It is important to distinguish which debts are and are not dischargeable while preparing a bankruptcy petition. One major benefit of a Chapter 13 bankruptcy as opposed to a Chapter 7 bankruptcy is that the scope of the types of debts that can be discharged is broader. (Some types of debts such as child support and most student loans cannot be discharged in any type of bankruptcy.)

The Meaning of the Discharge at the End of a Chapter 13 Bankruptcy

The debt discharge in a Chapter 13 bankruptcy releases a debtor from any further obligations involving those debts. Creditors that have been prohibited from seeking to collect on unpaid debts through provisions of the automatic stay are now permanently barred from doing so at the end of the Chapter 13 case. They may not contact a debtor, file a lawsuit, garnish wages or seize property. If they do, they will be held liable for penalties, including attorney's fees on behalf of the debtor.

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To learn more about the Chapter 13 discharge, call or email our bankruptcy lawyers today. We offer free initial consultations, quality services at competitive rates and effective representation statewide.

We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.