How Does Bankruptcy Court Works
How does conversion of a debt work in bankruptcy courts?
When a debt is discharged in bankruptcy court, the debtor does not have to pay the debt. When you file for bankruptcy, you must list all your debts and assets. If you have one or more debts that would be discharged, those creditors must be notified and given a chance to object to the discharge of the debt. If they do not object, the judge will approve your discharge, which means you do not have to pay that debt.
If there is an objection from a creditor, the judge will schedule a hearing on it. After the hearing, if the judge approves your discharge of all non-disputed debts, then those debts will be discharged, and you will not have to pay them.
For example, if you owe $10,000 on your credit cards and $50,000 on a car loan where only $20,000 is disputed by the lenders, then only $20,000 will be discharged, and you will still owe $30,000 on your credit cards and $30,000 on your car loan.
When someone has an outstanding debt for a long time, they might have to file for bankruptcy to make the debt disappear. There are many different types of bankruptcy, and as you might expect, some of the distinctions between them have to do with which debts are forgiven and which ones get paid off. However, people need to understand that one thing that can't be overlooked is a debt from a lawsuit settlement.
Bankruptcy Attorney Free Consultation
Our bankruptcy lawyers can assist with all aspects of the Chapter 7 and Chapter 13 Bankruptcy process. If you need help, call this law firm for free consultation, we have the Best Attorneys in Utah.
Ascent Law LLC
8833 S Redwood Road Suite C
West Jordan UT 84088
(801) 676-5506
https://www.ascentlawfirm.comDisclaimer: This is not legal advice and is simply an answer to a question and that if legal advice is sought to contact a licensed attorney in the appropriate jurisdiction.
