It occurred to me the other day that in my consultations and writing I focus a lot on what bankruptcy cannot do or what debts bankruptcy cannot eliminate. I suppose I do that mainly because of all the misinformation about bankruptcy. As a result, I tend to give less attention to the kinds of debt that bankruptcy can eliminate. But I am surprised to sometimes hear that people have gotten the wrong information about whether certain common debts can be discharged.
For the most part, bankruptcy can get rid of typical consumer debt. That includes credit cards, car loans, mortgages, home equity loans, payday loans, and even lending club loans. Bankruptcy will also eliminate medical bills from hospitals, doctors, and emergency service providers. Bankruptcy can get rid of amounts due after breaking a lease and for unpaid utility bills, including cell phone contracts. Debts that have arisen from running a business, such as franchise contracts, business leases, and other business-related contracts can also be eliminated.
Of course, this isn’t a complete list of debts that bankruptcy will get rid of, but you get the idea. More types of debts than not can be eliminated and most people can take care of 100% of their debts in bankruptcy, whether Chapter 7 or Chapter 13.
If you have any questions about whether you can eliminate your debts and get a fresh financial start by filing bankruptcy, we hope you’ll come in for a free, no-obligation consultation with an experienced Colorado bankruptcy lawyer. You can schedule your appointment by calling 303.331.3403 or by using our online scheduling system.