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Last Updated August 5, 2008 |
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Under federal bankruptcy laws, a debtor who is granted a bankruptcy discharge is no longer responsible for the payment of debts included in the discharge. The debts that are eligible for discharge vary under the different bankruptcy chapters. Chapter 7 bankruptcy requires the debtor to liquidate his assets and pay creditors according to certain priorities, with most unsecured debts subject to discharge. Chapters 11, 12 and 13 allow the debtor to reorganize and repay prioritized debt. Most of the remaining debt is then discharged. |
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