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What debts are excluded from Chapter 13 discharge?

If you qualify for Chapter 13 bankruptcy, it offers you many potential benefits. Because a Chapter 13 bankruptcy reorganizes your debt rather than liquidating assets in order to pay it off, in most cases you will be able to retain your property in Ohio, such as your house or your car, when you file for Chapter 13 bankruptcy. At the end of your repayment period, if you have kept up your payments on time, most of your debts will no longer remain.

However, filing Chapter 13 cannot make all your debts simply disappear. According to FindLaw, certain debts are ineligible for Chapter 13 and will remain even after your discharge is complete. For example, financial penalties that you incurred by breaking the law, such as drunk driving liabilities, are not included in your Chapter 13 filing. 

If you have a mortgage, or similar obligation that extends past the term of your repayment plan (typically three to five years) it will remain even after your Chapter 13 discharge. Your Chapter 13 filing may include any past due mortgage payments that you may owe, but the mortgage itself will continue for its intended duration.

Generally speaking, a Chapter 13 bankruptcy will not result in a discharge of student loans. However, if you are unable to continue making student loan payments, you may apply for a hardship discharge at the same that you file for Chapter 13, although your hardship discharge application will be separate from your bankruptcy filing.

Chapter 13 does not relieve you of your child support or alimony obligations, although it may result in a temporary halt of collection proceedings for past due payments. Furthermore, failure to meet domestic support obligations may result in a dismissal of your Chapter 13 case.

The information in this article is not intended as legal advice but provided for educational purposes only.

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