Virginia residents struggling with various debts may decide to go down the bankruptcy route to have their debts discharged. Before making the decision that could effectively help them regain control over their financial life, it is important to understand what certain terms mean and how it can impact one’s bankruptcy procedure.

The end result of the bankruptcy procedure is to have debts discharged. This refers to a court-order that is awarded at the end of the bankruptcy case, whereby the obligation to pay a debt is dismissed. Before this can be granted however, all the necessary requirements must be fulfilled. The silver lining is that once the debt is discharged, creditors can no longer take collection on that debt ever again.

How debts are discharged and how much is discharged depends on the type of bankruptcy one is in. generally, non-exempt assets are divided among creditors in Chapter 7 bankruptcy, whereas in Chapter 13 a repayment plan is utilized to repay most or all of the debt. While bankruptcy is likely to discharge most debts, like credit card and medical ones, there are some that cannot be released.

For example, child support and alimony cannot be discharged by either form of bankruptcy and neither can fines resulting from criminal activity. Besides this, court costs and retirement plan loans cannot be discharged through Chapter 7 and debts incurred by drunk driving and student loans cannot be discharged through Chapter 13 bankruptcy.

There are some debts that are too difficult to discharge through bankruptcy, and student loans are one of those types. Additionally, debts incurred through fraud are also not released. Before beginning one’s journey through the bankruptcy process, it might help to speak someone knowledgeable about it who can provide valuable guidance and help debtors get their life back on track.