What effect does a bankruptcy discharge have on the debtor’s personal liability?

What effect does a bankruptcy discharge have on the debtor’s personal liability?

• A. It Discharges The Debtor From Personal Liability For Dischargeable Debts, Preventing Creditors From Collecting Those Debts.
• B. It Eliminates All Debt Automatically.
• C. It Prolongs Liability For Nondischargeable Debts.
• D. It Transfers Debt To A Co-Debtor Automatically.

Answer: (A)

A bankruptcy discharge frees the debtor from personal liability for debts that are eligible to be discharged. Once the discharge is granted, creditors cannot pursue the discharged debts against the debtor, so the debtor is no longer personally obligated to repay them. This relief, however, does not wipe out all obligations: non-dischargeable debts (like certain taxes, child support or alimony, and most student loans in many cases) stay with the debtor, and liens on property can remain even after discharge. It also doesn’t automatically transfer the debt to a co-debtor; a co-signer or co-debtor may still be liable to the creditor.

A bankruptcy discharge frees the debtor from personal liability for debts that are eligible to be discharged. Once the discharge is granted, creditors cannot pursue the discharged debts against the debtor, so the debtor is no longer personally obligated to repay them. This relief, however, does not wipe out all obligations: non-dischargeable debts (like certain taxes, child support or alimony, and most student loans in many cases) stay with the debtor, and liens on property can remain even after discharge. It also doesn’t automatically transfer the debt to a co-debtor; a co-signer or co-debtor may still be liable to the creditor.