Can I file bankruptcy on loans with Arbitration clauses? 23 Answers as of April 17, 2014

I am getting ready to file Chapter 7 bankruptcy due to a large amount of credit card and personal unsecured loan debt. These loans have Arbitration clauses in them. Will the bankruptcy court release me from these debts or will I have to go through Arbitration?

Ask a Local Attorney. 100% Anonymous. Free Answers.

Free Case Evaluation by a Local Lawyer: Click here
EDWARD P RUSSELL | EDWARD P RUSSELL
It makes no difference whether there is mandatory arbitration clause in the agreement as those unsecured loans and credit cards are dischargeable in bankruptcy.
Answer Applies to: Minnesota
Replied: 4/17/2014
Garner Law Office
Garner Law Office | Daniel Garner
The bankruptcy discharge renders those contracts unenforceable, so you can disregard the arbitration clauses.
Answer Applies to: Oregon
Replied: 4/17/2014
MCBRIDE LAW OFFICE | Robert E. McBride
If you are granted a discharge in bankruptcy the arbitration clauses will be unenforceable. Of course, you must list the lenders on your bankruptcy schedules.
Answer Applies to: Pennsylvania
Replied: 4/17/2014
Tokarska Law Center
Tokarska Law Center | Kathryn U. Tokarska
The Arbitration clauses don't apply in bankruptcy.
Answer Applies to: California
Replied: 4/16/2014
GARCIA & GONZALES, P.C.
GARCIA & GONZALES, P.C. | Richard N. Gonzales
Debts will be discharged like any other debts.
Answer Applies to: Colorado
Replied: 4/16/2014
    A Fresh Start
    A Fresh Start | Dorothy G Bunce
    I think you mean "can you discharge, or eliminate" these kinds of loans. Federal law requires you to list all your debts on a bankruptcy petition. Whether you can eliminate these debts or not would require additional information about the debt. The problems are explained in 11 USC sec 523 - good luck trying to understand this law, as it is complicated.
    Answer Applies to: Nevada
    Replied: 4/16/2014
    Graves Law Firm
    Graves Law Firm | Steve Graves
    The arbitration clauses don't get in the way of filing bankruptcy. See a bankruptcy lawyer, and good luck.
    Answer Applies to: Texas
    Replied: 4/16/2014
    Janet A. Lawson Bankruptcy Attorney
    Janet A. Lawson Bankruptcy Attorney | Janet Lawson
    They will be discharged. The arbitration clause does not stop bankruptcy.
    Answer Applies to: California
    Replied: 4/16/2014
    Law Office of Marlin Branstetter
    Law Office of Marlin Branstetter | Marlin Branstetter
    The arbitration clause has no effect if you file bankruptcy, the creditor cannot make you go through the arbitration process. You will be released from those debts.
    Answer Applies to: California
    Replied: 4/16/2014
    Michael B. McFarland, P.A. | Michael B. McFarland
    Assuming that the debts are unsecured, and not entitled to priority, they should be dischargeable with or without arbitration clauses. To be certain, however, you should consult with an experienced bankruptcy attorney.
    Answer Applies to: Idaho
    Replied: 4/16/2014
    Law Office of Shirly L. Horn | Shirley L. Horn
    The debts will be discharged unless there is an allegation of fraud.
    Answer Applies to: Michigan
    Replied: 4/16/2014
    Patrick W. Currin, Attorney at Law | Patrick Currin
    You will not have to go to arbitration as there is no dispute. You are simply taking advantage of your right to discharge the underlying debts.
    Answer Applies to: California
    Replied: 4/16/2014
    HARVEY S. MORRISON, ATTONEY AT LAW
    HARVEY S. MORRISON, ATTONEY AT LAW | HARVEY S. MORRISON
    Yes - - the credit card issuers generally include arbitration clauses in their agreements; however, arbitration is used to avoid litigation [and harass debtors]. Bankruptcy discharges the underlying debt so that there is nothing left to arbitrate.
    Answer Applies to: Ohio
    Replied: 4/16/2014
    Law Office of Shawn N. Wright | Shawn N. Wright
    I've never had a problem discharging (wiping out) unsecured debt like this. Yes, the Bankruptcy Court will permit you to discharge them. You will not be forced into arbitration.
    Answer Applies to: Pennsylvania
    Replied: 4/16/2014
    Law Office of J. Thomas Black, P.C.
    Law Office of J. Thomas Black, P.C. | J. Thomas Black
    Yes, you can file bankruptcy on debts even though the underlying contracts or loan documents contain arbitration clauses.
    Answer Applies to: Texas
    Replied: 4/16/2014
    Law Offices of Eric W. I. Anglin
    Law Offices of Eric W. I. Anglin | Eric W. I. Anglin
    Yes, you may file on credit card debt with arbitration agreements.
    Answer Applies to: Indiana
    Replied: 4/16/2014
    Law Office of Stuart M. Nachbar, P.C.
    Law Office of Stuart M. Nachbar, P.C. | Stuart M. Nachbar
    While there are arbitration clauses, you can file the bankruptcy and include them. Arbitration is for resolution, bankruptcy can wipe them out (in a Chapter 7).
    Answer Applies to: New Jersey
    Replied: 4/16/2014
Click to View More Answers:
12 3 4 Free Legal QuestionsConnect with a local attorney