Are personal debts different than debts to corporations in bankruptcy? How? 14 Answers as of May 12, 2015

I loaned money to a close friend when she was doing poorly. We made up paper work and a payment plan, and I was expecting to get the money back at some point. Now she is filing for chapter 7 bankruptcy, and I wanted to know whether I would ever see that money again. I know most of her debts will be discharged. Will her debt to me be discharged too?

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GARCIA & GONZALES, P.C.
GARCIA & GONZALES, P.C. | Richard N. Gonzales
Unfortunately, yes. To be 100% certain, pay an experienced bankruptcy lawyer for one hour of their time. Show him or her the "paperwork". I doubt that it will make a difference, but there could be circumstances where a debt is not dischargeable (for example, if the debt is created through fraud or deceit). Good luck!
Answer Applies to: Colorado
Replied: 5/12/2015
Janet A. Lawson Bankruptcy Attorney
Janet A. Lawson Bankruptcy Attorney | Janet Lawson
Your debt will be discharged - unless she has assets the trustee can liquidate. The odds of that happening are very very slight.
Answer Applies to: California
Replied: 5/12/2015
The Law Office of Darren Aronow, PC
The Law Office of Darren Aronow, PC | Darren Aronow
Yes, her personal liability for that debt will be discharged but if it is corporate debt than you may be able to sue her corporation (if it is still operating).
Answer Applies to: New York
Replied: 5/12/2015
Patrick W. Currin, Attorney at Law | Patrick Currin
Your debt will be discharged.
Answer Applies to: California
Replied: 5/12/2015
Ronald K. Nims LLC | Ronald K. Nims
There is no difference in bankruptcy between debts to individuals and debts to businesses. Your loan will be discharged in the bankruptcy.
Answer Applies to: Ohio
Replied: 5/12/2015
    Law Office of Marlin Branstetter
    Law Office of Marlin Branstetter | Marlin Branstetter
    Her debt to you will be discharged. She may still pay after filing but that is up to her, yuu cannot do anything to try to forse her to pay.
    Answer Applies to: California
    Replied: 5/12/2015
    Stephens Gourley & Bywater | David A. Stephens
    No they are treated the same.
    Answer Applies to: Nevada
    Replied: 5/12/2015
    A Fresh Start
    A Fresh Start | Dorothy G Bunce
    Very few types of debts are not discharged in bankruptcy. A description of the types of debts not eligible to be eliminated is in 11 USC sec 523. Typically the debts that are included in this law are student loans, alimony, child support, many taxes, wages, and debt made in the 6 month period before filing bankruptcy. Best guess is that debts will be discharged. Some friends will pay in spite of the bankruptcy, but others won't. You cannot bring this up in your relationship without violating federal law.
    Answer Applies to: Nevada
    Replied: 5/11/2015
    Law Office of Michael Johnson
    Law Office of Michael Johnson | Michael Johnson
    Yes the debt could be discharged but a lot of times friends still feel obligated.
    Answer Applies to: Florida
    Replied: 5/11/2015
    Deborah F Bowinski, Attorney & Counselor at Law | Debby Bowinski
    Yes, the debt to you is treated no differently than a debt to any other unsecured creditor. Most chapter 7 bankruptcy cases do not result in any payment of unsecured debt. Having said that, if you receive a Notice of Possible Dividend in the case at any point, be sure to pay attention to is and file a Proof of Claim before the deadline in order to receive at least a small portion of what is owed to you.
    Answer Applies to: Colorado
    Replied: 5/11/2015
    Musilli Brennan Associates PLLC
    Musilli Brennan Associates PLLC | John F Brennan
    I would certainly have to look at the paperwork which is involved before I would render an opinion. Was loan made to her individually? Was it may do some form of business entity? Is there any security for the debt?
    Answer Applies to: Michigan
    Replied: 5/11/2015
    Richard B. Jacobson & Associates, LLC | Richard B. Jacobson
    Her debt to you will be discharged unless it was incurred by fraud. However, you and she can enter into a reaffirmation agreement to revive the debt, or she can make truly voluntary payments on a discharged debt. Good Luck.
    Answer Applies to: Wisconsin
    Replied: 5/11/2015
    Garner Law Office
    Garner Law Office | Daniel Garner
    It is likely that your debt will be discharged along with all her other debts, unless you can make a convincing case that there was fraud involved. Even if there was fraud, you have to evaluate whether excepting your debt from discharge will make any difference in your ability to recover the loan. Otherwise, you could spend a lot of money litigating and still end up with nothing. If you received notice of her bankruptcy, be careful not to violate the stay by contacting her in any way. You can attend her hearing with the trustee and ask questions there, or not. If the trustee determines that there are assets available to pay debts, you will receive notice and be given a chance to file a claim. If you think there was fraud, talk to a lawyer promptly about challenging it. You must object before her discharge is granted by the court.
    Answer Applies to: Oregon
    Replied: 5/11/2015
    Thomas Vogele & Associates, APC | Thomas A. Vogele
    In all likelihood your loan will be discharged because it is unsecured. She can reaffirm the debt after she receives her discharge, but that is probably the only way you'll ever recover anything on the loan.
    Answer Applies to: California
    Replied: 5/11/2015
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