Get a super discharge with Chapter 13

In consumer bankruptcy cases, all discharges are not exactly alike.

The rules concerning the discharge of debts in bankruptcy are more generous in Chapter 13 cases. A Chapter 13 debt discharge is commonly known as the “super discharge” because the scope of the discharge is broader than the discharge given in Chapter 7 cases. In Chapter 13 cases, all debts are dischargeable, potentially without any payment, except for the following. But even if a debtor successfully completes his Chapter 13 plan, the following types of debts will not be discharged:

► non-dischargeable tax claims;

► fraud claims – adversary proceeding required;

► child support and alimony obligations (both arrearages and ongoing obligations;

► student loans;

► restitution or a criminal fine included in a sentence on the debtor’s conviction for a crime;

► unlisted debts;

► theft, conversion or breach of fiduciary duty;

► willful and malicious injury causing personal injuries or death to another person ; and

► drunk drivers causing death or injury.

While the super discharge in Chapter 13 potentially covers more debts, it rarely is the sole or even driving reason for filing under that chapter. Avoiding foreclosure or a reposession, and paying legal fees over time remain the most common reasons debtors opt for Chapter 13.

by Doug Beaton

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