Chapter 7 bankruptcy in Utah is quite forgiving. It will give you a clean slate by relieving you of all or most of your debt balances. In the state of Utah you can keep your house, cars and most of your assets. However, there are some things you will still be responsible for. These include child support arrears, student loans you may be or may not be in default on, alimony payments, unpaid taxes, debts incurred as a result of fraud, and other debts deemed payable by the bankruptcy trustee.
You Can Stop Garnishments of Your Income and Debt Collector Calls
Once you have filed with the court, it becomes illegal for anyone to come after you to collect on an outstanding debt or to be granted new liens against you. You may be able to reaffirm on some of yours debts if you choose to do so, but reaffirmation agreements will typically require that you catch up late payments or renegotiate them.
Keeping Your Home
You will be able to keep your home so long as you continue to pay your mortgage payments. If you have been late in making your payments and you are in default on your mortgage or behind on payments, the only way you may be able to keep your residence is under a Chapter 13 bankruptcy.
If You Have Secured Loans
Pre-existing liens cannot be wiped by a Chapter 7 bankruptcy, in which case you have three choices. You can give back your home or car which makes sense if you cannot afford the payments. In that case, that debt will be cleared under your bankruptcy. You can pay for the value of whatever it is to the lending agent, or you may negotiate and sign a new agreement with the lender.
