One of the problems that many Americans face is that they have accumulated traffic ticket debt and can’t pay it off. These people don’t realize that bankruptcy can help to reduce the amount of traffic ticket penalties or, in some cases, eliminate it completely.
What Type of Bankruptcy Helps?
If you are one of these people who need relief from traffic ticket debt, then you need to know that bankruptcy can offer that relief. If you file for Chapter 7 bankruptcy you may not be able to have this type of debt discharged, since they fall into ineligible debts. These include government fines, penalties, traffic tickets, and more.
If, however, you decide to file for Chapter 13 bankruptcy, you may be eligible to discharge this traffic ticket debt. The only way it can be discharged is if it is included in the repayment plan once it is approved by the court.
Eligible Non-Criminal Debt
When you file for Chapter 13 bankruptcy, non-criminal debt such as traffic tickets related to speeding, parking, or other traffic infractions can be included within the repayment plan. You can use this plan to restructure the debts and use bankruptcy to stop calls from creditors, including those from the government. It can also eliminate any overdue debt and remove any additional interest on the fines you are facing.
Your repayment plan usually entails a detailed list of debts that will be dismissed and repaid over a period of 3-5 years. You will need to have your plan reviewed by the bankruptcy court and see whether the debts meet elimination standards. It is important to realize that some of the debt may be considered as reimbursement for the government if they want to “recoup losses” associated with the offense you committed. Your bankruptcy attorney will be able to guide you in what debt can be included.
Traffic ticket debt can certainly add up and get to the point where it is impossible to pay. Consult your bankruptcy lawyer to see where you stand in including it in your bankruptcy plan.