Gilbert Bankruptcy and Child Support: Do I Still Have to Pay?
Bankruptcy is a powerful tool for getting the debt relief that you need. It can discharge thousands of dollars in credit card and medical debt, or it can restructure your debt to pull your house back from the brink of foreclosure.
Bankruptcy can be so transformative to your personal finances and your life that you may feel like it can do anything. Unfortunately, when it comes to certain debts or financial obligations, such as child support, it has limited power. Bankruptcy can’t do anything to put an end to your current child support obligation. However, if you under such financial duress that you are considering filing for bankruptcy, you probably have good cause to take your case before the courts again to have your child support order adjusted.
If you owe old child support, filing for bankruptcy may help, depending on your personal circumstances. Here are a few options to explore with your bankruptcy attorney in GIlbert:
Chapter 7 Bankruptcy
Chapter 7 bankruptcy cannot discharge child support debt, nor can it discharge other government-mandated debts such as criminal penalties or old taxes. But that doesn’t mean that Chapter 7 bankruptcy is totally useless in helping you get a better handle on your old child support.
Filing for Chapter 7 can clear out many of the debt payments that are weighing down your budget, freeing up the ability to pay back that old child support and to stay current with your current payments. Put together all the money you pay now toward credit cards, medical bills, and other unsecured debts, and you can get an idea of how much a Chapter 7 bankruptcy would free up to pay your old child support.
Chapter 13 Bankruptcy
Chapter 13 bankruptcy may be somewhat more helpful if you are trying to manage back child support. Chapter 7 bankruptcy has strict eligibility requirements, so you may not be able to file. Or you may meet the criteria, but you may not have much in the way of credit card or other debts. In that case, it may be better for you to file for Chapter 13 bankruptcy, which is known as a debt restructuring plan.
Under a Chapter 13 bankruptcy, your debts, including back child support, can be organized into a debt repayment plan that lasts for three to five years. Some of your debts will be reduced based on your ability to pay, and some will even be discharged at the end of the repayment period. However, you can expect to pay the full amount you owe for child support.
Chapter 13 bankruptcy is helpful because it puts you on the path to pay back your child support without fear of penalty, such as fines or even jail time. The courts will see that you have a plan for payment, and so long as you remain consistent with your payments, you should keep yourself out of trouble.
Talk with a Bankruptcy Attorney
Before you make any decisions about whether or not to file for bankruptcy and which type, you should sit down with an experienced bankruptcy attorney to go over your financial circumstances in detail and to talk about what you hope to accomplish. An experienced bankruptcy lawyer can help you understand what will be possible with each type of bankruptcy. Your attorney can also explain your other debt relief options to you so that you can make the best choice for your circumstances to get the maximum debt relief.
Gilbert Bankruptcy Lawyers helps individual and business clients who are seeking debt relief and a way to gain control of their finances once again. Our bankruptcy law office handles Chapter 7 bankruptcy, Chapter 13 bankruptcy, and many other types of bankruptcy for businesses. Our goal is to help you get the maximum debt relief so that you can feel in charge of your finances and our life once more. We can help you explore options for managing debts that cannot be liquidated under bankruptcy, as well, such as old child support, tax debts, and student loans. Contact us in Gilbert today to talk with an experienced and dedicated bankruptcy attorney about your options. We’re passionate about helping people get the help they need to get their finances back on track.