Chapter 7 Bankruptcy And Court Ordered Judgments
Other than winning the Powerball, Chapter 7 bankruptcy is the most powerful tool there is to destroy overwhelming debt. It can eliminate staggering medical and credit card debt among other types of debt.
Can it eliminate court ordered judgments? It depends. Let’s take a deeper look.
What Kinds Of Debts Does Chapter 7 Bankruptcy Not Eliminate?
Chapter 7 bankruptcy will eliminate most consumer debt. That includes credit cards, personal loans, medical bills, car loans, residential leases, and a whole host of other consumer debts.
However, Chapter 7 bankruptcy is not invincible. There are some debts that will survive Chapter 7’s silver bullet. The primary ones are child support, spousal maintenance (formerly known as alimony), certain taxes, student loans in most cases, government fines, which can include things like traffic tickets or restitution.
But there are a few other debts that are less common that Chapter 7 bankruptcy will not eliminate. Chapter 7 bankruptcy cannot typically eliminate intentional torts.
One example of an intentional tort is a fist fight. If you start a fight with someone and injure that person, there are probably going to be two court judgments. One will be from a criminal lawsuit where the district attorney charges you for violating the law. The other court judgment will be from a civil lawsuit filed by the person you injured. Chapter 7 bankruptcy will also not eliminate that judgment.
On the other hand, if someone attacks you and you injure that person while defending yourself, you can likely eliminate any judgment or stop a lawsuit from any person irrational enough to bring a lawsuit.
Another example of an intentional tort is fraud, such as embezzlement. Chapter 7 bankruptcy is not going to eliminate that debt either.
Does Chapter 7 Bankruptcy Eliminate Court Ordered Judgments?
To determine whether or not Chapter 7 bankruptcy can eliminate a court ordered judgment, we have to find out what the judgment stems from.
If the court ordered judgment stems from a criminal charge, Chapter 7 bankruptcy is probably not going to help. You’ll know it’s a criminal case because you’ve been arrested for it.
But if the court ordered judgment came from a breach of contract lawsuit filed by a credit card company, Chapter 7 bankruptcy can eliminate that judgment. You won’t get arrested for a civil lawsuit.
The bottom line is that if the underlying debt for the court ordered judgment is a debt you can eliminate, then the judgment itself can also be eliminated. The judgment doesn’t transform it into something you can’t eliminate.
So, Chapter 7 bankruptcy can eliminate a court ordered judgment as long as the underlying debt is something you can eliminate. Further, you can also eliminate the debt even if the creditor has started garnishing you.
Talk To An Experienced Denver, Colorado Bankruptcy Attorney About Eliminating A Court Ordered Judgment
We offer free consultations to people who are considering bankruptcy. When you talk with an experienced Denver, Colorado attorney, we can tell you whether or not Chapter 7 bankruptcy will eliminate a court ordered judgment.
The easiest way to schedule an appointment at a time that is convenient for you is by going to our scheduling page.
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