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Monday, December 12, 2011

When Debts Don't Get Discharged

Many people enter bankruptcy in hopes of obtaining a debt discharge to alleviate their financial burdens. While many people have few problems with achieving this goal, there are some who run into roadblocks along the way. There are cases in which a debtor has committed, purposely or unknowingly, rule violations about how debts are acquired prior to filing that leaves them without a discharge and back to square one.
There are two reasons why a bankruptcy court would deny a credit card debt discharge: (1) falsifying information to secure the card or (2) using the credit card fraudulently. Committing either one of these acts can quickly lead to a case dismissal, in which your debts will not be eligible for discharge. The best way from preventing this from happening to you is getting to know the rules about debt accumulation and eligibility standards for debt discharge.
Falsifying Information
It is not uncommon for a person to falsify information on a credit card application. Maybe they have been rejected for credit several times or they cannot secure a good credit deal. In either case, lying about the information on a credit card application can prevent your debts from being eligible 

for discharge in bankruptcy. Falsifying information can take many form such as such as misstating your income or assets, lying about your employment status or using a false social security number.
Many people assume that they are not at risk of being found out simply because their creditor did not notice the falsified information. However, when you file for bankruptcy your financial details are closely scrutinized. The bankruptcy process also conducts a Meeting of Creditors, in which your creditors can attend to dispute any information. With your creditors in the room of bankruptcy officials reviewing your personal records, it is highly likely that your misleading will come to light. Any attempt to conceal information will likely be revealed, which can cause you to lose your chance at a debt discharge.
Fraudulent Charges
Bankruptcy laws hold a strict position on how debts are acquired if they are to be eligible for debt discharge. Perhaps one of the most common mistakes held by debtors is filing for bankruptcy on fraudulent charges, which is not the type of fraud you generally picture. Bankruptcy courts view purchasing of non essential items, charging over the credit limit, non-payment after large purchases and recent charges just prior to filing as fraudulent. The court will not discharge any debts over $500, acquired within 90 days of filing, or any cash advances over $750, within 70 days of filing. Many people are unaware that their actions are considered fraudulent by the bankruptcy, only to find out when it is too late.
The Lee Law Firm aims to provide local residents with high quality legal representation at affordable rates. Their Dallas bankruptcy attorneys specialize in all aspects of Chapter 7 and Chapter 13 Bankruptcy. As bankruptcy lawyers in Dallas, the Lee Law Firm attorneys understand the pressures their clients face as the battle a financial hardship.

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