What Debts Can be included in a bankruptcy?
When you are discharged from bankruptcy, you will be released from the debts that existed at the date of bankruptcy. All of your debt must be listed on your bankruptcy documents regardless of what they are for.
When being discharged from bankruptcy, some types of debts cannot be released. This means that you are still obliged to pay off these debts even though you have been discharged from bankruptcy.
Debts that are not released by your discharge from bankruptcy
The types of debts not included in a bankruptcy are:
Secured debt (that uses property or assets as collateral, e.g. a car loan or mortgage) where you chose to maintain the secured asset
Alimony payments and child support
Student loans, if you file your bankruptcy less than seven years since you ceased to be a full-time or part-time student (however, five years after your studies, you can make an application for release from your student loans on the basis of hardship)
A fine or penalty imposed by the court
Debts arising from fraud, embezzlement or misappropriation
Debts arising from obtaining property or services through fraud
Damages arising out of wrongful death or sexual assault, intentionally caused
Court imposed fines, bail bonds or restitution orders
Guarantors or co-signers on loans, credit lines, etc.
Bankruptcy does not affect the liability of someone who has guaranteed or co-signed a loan on your behalf. This means that someone who has guaranteed or co-signed a loan on your behalf (such as a spouse, partner or relative) will be obligated to pay liabilities incurred jointly with you. Therefore, it is important to make the trustee aware of any joint liabilities at the time of filing.
For more information on filing a joint proposal with a spouse, contact a BDO trustee in bankruptcy.