Bankruptcy cannot cure every financial problem. Nor
is it the right step for every individual. In
bankruptcy, it is usually not possible to:
Eliminate certain rights of “secured” creditors. A
“secured” creditor has taken a mortgage or other
lien on property as collateral for the loan.
Common examples are car loans and home mortgages.
You can, however, force secured creditors to take
payments over time in the bankruptcy process, in a
chapter 13, and bankruptcy can eliminate your
obligation to pay any additional money if your
property is taken. Nevertheless, you generally
cannot keep the collateral unless you continue to
pay the debt.
Discharge types of debts singled out by the
bankruptcy law for special treatment, such as
child support, alimony, certain other debts
related to divorce, most student loans, court
restitution orders, criminal fines, and some
Protect cosigners on your debt. When a relative or
friend has cosigned a loan, and the consumer
discharges the loan in bankruptcy, the cosigner
may still have to repay all or part of the loan.
Discharge debts that arise after bankruptcy has