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The Fresh Start

One of the main benefits of a bankruptcy filing is the concept of a fresh start. In everyday life, we routinely see people in need of a second chance, a do-over, a fresh start to get back on track. These concepts have deep cultural and even religious roots; when discussed, people use terms like “forgiveness,” “rebirth” and other evocative language to describe the lightening, unburdening effect of getting a fresh start.

The bankruptcy discharge is a powerful fresh start. In most cases, it eliminates most or all of a qualifying debtor’s debts. There are exceptions — debts you choose to keep, student loans, child and spousal support, certain taxes, debts incurred by fraud, and others — but by and large, the bankruptcy discharge clears the decks of unpayable debts.

Most people think of credit card debts and medical bills when they think of bankruptcy — but the discharge covers much more than those obligations. Consider the various contracts and legal commitments adults routinely make over the course of their lives. Leases, business transactions, utility contracts … all of these (and the lawsuits they engender!) are washed away by the discharge, subject only to valid liens against property. Assuming you qualify, there is no cleaner way to unburden yourself of these commitments than via bankruptcy.

The removal of the debts in turn creates room for personal growth and change, to hopefully make us both wiser and more cautious in the future. For the honest but unfortunate debtor, bankruptcy’s fresh start is truly a new beginning.