What type of debt is discharged in a Chapter 7 bankruptcy?
In a Chapter 7 bankruptcy the court will discharge most types of debt including credit card balances, medical bills and finance company loans. Certain types of debts such as recent income taxes, student loans and child support obligations are not dischargeable. With respect to secured debts, like a home mortgage or a car loan, debtors have the option to keep the property and keep making the payments, or surrender the property to the lender and discharge the debtor’s liability. One is generally able to keep all of one’s property, unless you have substantial equity in the property beyond what California law allows you to protect.
