Can payday loans be included in bankruptcy

can payday loans be included in bankruptcy

Payday loans can be discharged (wiped out) in your bankruptcy. Most people are nervous to list payday loans in bankruptcy because they took them out recently and even worse, they signed a contractual provision as part of the payday loan that they could not file bankruptcy on that loan. Michelle, from what you said, yes, bankruptcy would be able to get rid of your debts including payday loans. Be sure to consult with an experienced bankruptcy lawyer in your local area to be sure, because details (more than can be discussed here) are important. Any debts that are determined to be fraudulent by the bankruptcy court are generally non-dischargeable and cannot be included in a bankruptcy settlement. It is up to the PayDay loan company to prove that these loans were incurred after the cut off date. A key feature of Bankruptcy is that you must include all of your unsecured debts in the arrangement. Payday loans are unsecured debts and so they will always be included and written off along side any other unsecured debts that you have. However given the nature of payday loans it is likely that you have only taken them out relatively recently. After 70 days, the creditor can still object, there's just no presumption. Long story short, the longer you wait the less likely you are to have a problem. Payday loans themselves get no extra protection in bankruptcy. 0 found this answer helpful helpful votes | 0 lawyers agree Loans made within a short period (certainly 90 days) of bankruptcy generally aren't included in the filing as they are considered taken in anticipation of bankruptcy. Payday loans do present some potential hazards in a bankruptcy filing, however. These hazards arise from the peculiar qualities of payday loans described above: the provision of post-dated checks, location of the creditors involved, and the quick turnaround time required contractually for repayment of the loans. In most cases, you can wipe out (discharge) a payday loan in Chapter 7 bankruptcy or pay some part of it in Chapter 13 bankruptcy (often a small portion). As long as the payday loans were not incurred through fraud, payday loans are dischargeable in bankruptcy.  (Honestly I’m not sure how you could get a payday loan fraudulently– I suppose by lying about having a job; but they all require proof of a paystub and other verification). Payday loans can be discharged in Chapter 7 bankruptcy like any other unsecured debt (see note below). In a Chapter 13 bankruptcy filing, payday loans are treated the same as other unsecured debts, so they will be paid down but only a portion of the debt.