Before signing on to just any debt relief option, it is wise to gain an understanding of how it really works and how it will benefit one’s situation. For example, if one files for a Chapter 7 bankruptcy and it is approved in court, his or her debts may be discharged. Michigan residents who are not familiar with bankruptcy law will likely want to know what that means exactly.

If a debt is discharged through bankruptcy, it means that the petitioner will no longer be held responsible for making payments on that particular debt. Following bankruptcy approval, discharge takes effect as soon as the court sends notice to the affected creditors. The whole process, from first filing a bankruptcy petition to achieving court approval and notifying creditors of debt discharge, takes an average of 90 days. However, every case is different and this may be prolonged if creditors file objections.

A common question many have about debt discharge is: Will a Chapter 7 filing clear all debts? It all depends on the kinds of debts one owes. There are certain items that cannot be discharged. These include:

  • Child and spousal support
  • Student loans
  • Certain taxes
  • Civil or criminal court ordered fines/restitution

This has been a very brief overview of Chapter 7 debt discharged. An experienced bankruptcy law attorney can answer any other questions or address any concerns one might have about this debt relief option. By seeking assistance as soon as possible, Michigan residents who are struggling economically can take the steps necessary to gain control of their financial situations.

Source: uscourts.gov, “Discharge in Bankruptcy – Bankruptcy Basics“, Accessed on April 5, 2017