New York Bankruptcy Laws, Lawyers FAQ, Filing Help Online
The most frequently asked legal questions are about discharge of debts, because in the end, the elimination of
debts is the ultimate goal of everyone who files. A discharge of debts is available in both Chapter 7 & 13 cases.
The term "straight bankruptcy", when used by bankruptcy lawyers, usually refers to a Chapter 7 case. In this chapter,
all general debts eliminated as if paid in full. No further payments are required, and debts become legally
unenforceable after court approval of discharge at the final hearing.
Chapter 13 cases provide full or partial payment to creditors, depending upon disposable income. In full Chapter
13 cases, payment may reduce interest, extend terms, and disputes amounts owed. In partial Chapter 13 plans, only
a portion of undisputed debts are repaid according to the ability and disposable income earned by debtor(s). As
of October 17, 2005, all plans last five years. Remaining balances are discharged at the end of the plan similarly
as in Chapter 7 cases. Objections to discharge and adversary proceeding frequently pertain to discharge issues,
and create complex litigation which clog court dockets unnecessarily. For more information, see:
New York Bankruptcy Law & Lawyer Frequently Asked Questions FAQs)
Special issues are subject to extraordinary regulation. Liability for debts owed to
all government entities or
created by operation of law without knowing consent of others generally receive a higher level of
protection under the Code. Bankruptcy lawyers
representing creditors frequently contest discharge claiming these
exceptions:
The cost of defending against objections must be born by each party.
Debtors who file frivolous motions are subject to mandatory sanctions
upon the request of creditors. Creditors who file frivolous objections
are not subject to the same mandatory sanction provision.
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