Non-dischargeable Debts
In my last posting I spoke about whether a debt is dischargeable and realized this can be somewhat confusing to the people I meet.
Some debts are very clear, such as child or spousal support, when deciding if they are dischargeable. Others are not.
A quick and simple list of non-dischargeable debts is:
- fines, penalties, restitution orders (this means things like parking or speeding tickets, a court order to pay monies for damages of some sort);
- alimony, child or spousal support (as ordered by the courts or separation/divorce agreements);
- student loans 10 years old or less (if guaranteed by a government body - do not get confused with financial institutions who offer a student line of credit)
- amount a creditor would have received who was not disclosed to the trustee (this is why it is important to disclose all people/creditors to whom you owe money, whether related or not);
- fraud, embezzlement, misappropriaton of funds and obtaining property by false pretences or fraudulent misrepresentation (this one is more complicated and must be proven in a court of law).
If you are experiencing financial difficulties and visit our offices, I will review your list and advise if there could be a problem with a non-dischargeable debt. However, it is ultimately the creditor who decides if they will pursue a debt through the courts after discharge. If your relationship with a creditor is honest, unless it meets one of the above criteria, it should be dischargeable. The trustee cannot guarantee all your debts will be discharged in a personal bankruptcy or a consumer proposal.
Call Hoyes, Michalos and Associates Inc. at 310-PLAN to receive a free initial consultation in London to discuss your financial situation.
