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Blog > 2017 > June > Can Filing Bankruptcy Wipe out My Car Accident Judgement in California?

Can Filing Bankruptcy Wipe out My Car Accident Judgement in California?

June 20, 2017
Bankruptcy Car Accident

A lot of people wonder what type of financial judgments they can avoid through bankruptcy. For example, everyone knows that if you have a lot of credit card debt or loans, it is possible to wipe out a significant portion of this debt through a bankruptcy filing. This is especially true when you are filing for Chapter 7 bankruptcy. However, this courtesy does not extend to all types of debt, especially in certain situations.

Dischargeable Judgment Debts

First, let’s start off with the types of judgments that bankruptcy can wipe out.

If you have credit card debts, personal loans, or medical debts, these are typically dischargeable in a normal bankruptcy whether or not there is a judgment against you.

Judgment Debts That Bankruptcy Cannot Discharge

Certain debts are declared non-dischargeable when you enter bankruptcy court. This means that even if you successfully declare and have all your dischargeable debts wiped, the non-dischargeable debts are not going anywhere!

Debts you cannot discharge through bankruptcy include:

  • Student loans
  • Child support or spousal support payments
  • Government debts such as tax debt or parking ticket fines
  • Penalties associated with a DUI conviction or DUI accident

Bankruptcy Does Not Eliminate Car Accident Judgments

There is a common question among individuals about whether filing for bankruptcy can wipe out car accident judgments in California. The reality is that bankruptcy does not always wipe out these judgments, and we will explain why.

For example, there are car accident judgments where you cannot discharge the judgment no matter what type of bankruptcy you file. This is especially true if some form of alcohol or drugs were involved in the accident. An individual who drives while under the influence, gets into an accident, and causes damage or kills someone cannot get the judgment discharged through bankruptcy.

Debts from Other Accidents

This applies not only to car accidents but to any injuries caused by a willful or malicious act. But cases where the accident occurred because of a simple driver error, and where no alcohol or drugs were involved, are dischargeable through Chapter 7 bankruptcy. This is an important distinction to make for individuals who are thinking about filing.

In some cases, individuals who get into an accident and are deemed at fault will place their property in lien to satisfy the judgment. This is often done by insurance companies if the individual does not have enough savings to satisfy the court’s financial judgment. If these liens are in place, the bankruptcy judgment cannot discharge them.

Discuss Your Debts with Our Bankruptcy Team

It is very important to talk with a bankruptcy attorney if you are worried about debts related to a car accident or other types of legal judgments. The attorneys at SM Law Group are experienced in getting the results you deserve. Call us today for a free consultation.

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