If you have debt you simply cannot pay, you may feel a variety of emotions. In fact, researchers have found a strong correlation between recurring debt and both anxiety and depression. Fortunately, you may not have to put up with the mental health consequences of your outstanding financial obligations.
Filing for either Chapter 7 or Chapter 13 bankruptcy protection may give you an opportunity to address your debt in a positive and proactive way. You should realize, however, that you cannot get rid of all your debt with a bankruptcy filing. Here are four debts that usually are typically nondischargeable in bankruptcy.
- Family support obligations
For a few different reasons, New Mexico residents sometimes have child support, alimony or other family support obligations. Whether you are behind on these payments or current with them, your bankruptcy filing does not discharge them.
- Fines and criminal restitution
If you break the law, you must pay for your misbehavior. As such, traffic tickets and similar types of citations usually do not discharge in bankruptcy. Furthermore, if a judge has ordered you to pay criminal restitution, you must do so regardless of your bankruptcy filing. The same is true if you injured someone or caused property damage while driving under the influence. If you are having trouble with your student loan payments, it may be helpful to consult a professional to discuss your options.
- Student loans
Discharging student loans in bankruptcy is exceedingly difficult. There is an exception, however. If you can show repayment of your loans is apt to cause you undue hardship, you may be off the hook.
- Many tax debts
Your bankruptcy filing is apt to have little effect on your tax debts. That is, if you owe taxes to the government, you probably must pay them. Nevertheless, you may be able to discharge income taxes that are more than three years old.
If you have any of these debts, you may not be able to discharge them in bankruptcy. By discharging other debts, however, you can free up funds to tackle your nondischargeable obligations. Either way, exploring your bankruptcy options may be a critical step in improving your mental health.