The Bankruptcy Discharge: An Overview

The Chapter 7 and Chapter 13 bankruptcy discharge gets rid of your personal obligation to pay certain debts.

Most debtors file for bankruptcy relief to eliminate their debts through the bankruptcy discharge. But a bankruptcy discharge doesn’t wipe out all types of debts. Read on to learn more about what the bankruptcy discharge is, how long it takes to get one, and which debts it wipes out.

What Is a Bankruptcy Discharge?

A bankruptcy discharge eliminates your personal liability for and obligation to pay back most types of debts. If you discharge a debt in Chapter 7 or Chapter 13 bankruptcy, the creditor can’t sue you or otherwise come after you to collect the debt.

When Do You Receive a Bankruptcy Discharge?

How long it will take you to receive a discharge depends on whether you file for Chapter 7 or Chapter 13 bankruptcy.

Chapter 7 bankruptcy discharge. The court will enter a discharge in a Chapter 7 when you satisfy all requirements to successfully complete your bankruptcy (such as attending the meeting of creditors and completing a debtor education course). In most cases, you will receive your discharge within 90 to 120 days after you file your case.

Chapter 13 bankruptcy discharge. In Chapter 13 bankruptcy, you pay back a portion of your debts through a repayment plan. A Chapter 13 bankruptcy plan typically takes three to five years to complete. Unless you convert your case to Chapter 7 or ask for a hardship discharge, the court won’t enter a discharge until you successfully pay off your Chapter 13 plan. (Learn more about the Chapter 13 repayment plan.)

Which Debts Does the Bankruptcy Discharge Eliminate?

A bankruptcy discharge wipes out your personal liability for most types of debts. The following are some of the most common debts a bankruptcy discharge will eliminate:

  • credit card debt
  • medical bills
  • personal loans
  • back rent
  • utility bills, and
  • most lawsuit judgments.

Keep in mind that this is not a comprehensive list and the types of debts you can discharge in bankruptcy also depend on whether you file for Chapter 7 or Chapter 13 bankruptcy. (Learn more about dischargeable debts in Chapter 7 bankruptcy and dischargeable debts in Chapter 13 bankruptcy.)

Debts That Survive Your Bankruptcy Discharge

There are some debts that you can’t wipe out by filing for bankruptcy (these are called nondischargeable debts). The most common types of nondischargeable debts include:

  • priority tax obligations
  • alimony and child support
  • student loans (unless you can prove undue hardship)
  • debts obtained through fraud or false pretenses, and
  • debts for personal injury or death caused by drunk driving.

(Learn more about debts that survive Chapter 7 bankruptcy.)

by: , Attorney

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