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In many cases, you will lose secured assets such as your home and vehicles. Bankruptcy does not generally discharge debts associated with child support, alimony, tax obligations, or studentloandebt. Federally managed studentloans received an automatic six-month payment waiver.
Unsecured debts, such as credit cards, store cards and personal loans, can be part of your DMP. Secureddebts, like your mortgage or car payments, aren’t covered. Studentloans aren’t covered, either. Bankruptcy can be a potential option when you’re totally overwhelmed by your debt.
When You Have Too Much Debt to Handle Sometimes debt can pile up to the point where making even minimum payments feels impossible with your current income. Credit card balances, personal loans, and other unsecured debts can quickly spiral out of control, especially when combined with secureddebts like a car loan or mortgage.
These debts have no collateral, so creditors cannot take your property without going to court first. Late utility bills also count as unsecured debt. Some debts stay with you even after bankruptcy. Studentloans, child support, recent taxes, and court fines must be paid in full.
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