Will Bankruptcy Discharge All of My Debts in Pennsylvania?
In 2023, bankruptcy filings totaled 452,990, an increase of 16.8 percent from the year prior. Typically seen as a way to start anew, bankruptcy may be the answer you have been searching for to climb your way of debt. However, not all debts are dischargeable, which can impact your decision. If you are considering bankruptcy, our Hershey, PA, debt relief attorney is available to answer any of your concerns.
What is a Dischargeable Debt?
Discharging a debt means that a debtor is released from all liability. Many types of debts are dischargeable, such as credit card debt, medical debt, utility bills, and civil court judgments. When a debt is discharged, you are free from all responsibility for paying back the debt, and creditors will not be able to take legal action against you.
What is a Nondischargeable Debt?
Under the Federal Bankruptcy Code, nondischargeable debts include:
- Most tax debt
- Debts for luxury goods and services greater than $500 purchased within 90 days of filing bankruptcy
- Student loan debt
- Alimony or spousal support
- Child support
What Property Are You Allowed to Keep?
When you file for bankruptcy, certain properties will be exempt or protected from creditors. When filing bankruptcy in Pennsylvania, it is better to use federal exemptions, which are as follows for a single filer:
- $27,900 in home equity (The current value of your house minus your mortgage or outstanding liens)
- $4,450 in vehicle equity
- $700 per item in household goods, up to $14,875
- $2,800 in tools of your trade and professional books
- $1,875 in jewelry
- Wildcard exemption of $1,475 (can be applied to any property you own)
- Up to $13,950 of any unused exemption in your home
Is Bankruptcy the Right Answer for Me?
The process of filing for bankruptcy can be tedious, requiring that you know what court forms need to be completed and when each is due. While Chapter 7 bankruptcy has helped many individuals wipe the slate clean, it may not be the right choice if the majority of your debt can be attributed to federal or state taxes, alimony, child support, or student loans. In this case, you may need to consider a Chapter 13 filing, which will allow you to restructure your debt.
Bankruptcy is not the solution for every financial situation, and in some cases, negotiating a plan with creditors to pay off your debt may be your best option. At Audi Law, PLLC, our Hershey, PA, debt relief lawyer will work with you to find a path that best fits your needs while keeping the lenders and creditors off your back.
Ready to Get Started? Contact Our Hershey, PA, Debt Relief Attorney Today
Trying to manage debt can feel like a full-time job. If you are dealing with overwhelming debt, now is the time to act. At Audi Law, PLLC, our Hershey, PA, debt relief lawyer will review your financial picture and advise you on the best course of action to help you achieve economic stability. To discover what our Hershey, PA, debt relief lawyer can do for you, contact us online or by phone today.