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Bankruptcy and Gambling Debts

If you are considering filing for bankruptcy and also have wagering debt, you may be wondering how that type of debt is handled in bankruptcy. Will it be wiped away so that you can be reduce it? As with most things in law, the answer is “it depends. ” Wagering debt is usually daftar slot pulsa unsecured, non-priority debt. In bankruptcy, that is the type of debt that is most easily wiped away. That is, it is not secured by many assets and it is not a “priority”debt like back taxes or child support that cannot be wiped away. So, in general wagering debt can be wiped away.

While that is good news, there is another side of the coin that must be considered. The debt will be listed on your schedules as unsecured, non-priority debt and, if the creditor does not object to the discharge, the wagering debt will be wiped away just like credit card debt, signature loans, medical debt, and other types of unsecured debt. That may be a big “if” though. The creditor may in fact object to a discharge of the wagering debt. The basis of argument searched by such creditors is that you did not have the ways to repay the loan at the time the loan was made. This is considered a type of fraud and fraudulently borne debt is not dischargeable in bankruptcy.

This type of fraud is generally better to prove with wagering debt than with other kind of personal debt. For example, with credit cards it is often years earlier that the credit agreement was signed. The credit decision was based on your debts and income at that time, not your debt and income as it stands now. (Note, though that if you run up your charges right before filing for bankruptcy, that may also be considered fake and non-dischargeable).

If you have recently racked up wagering debts and are considering filing for bankruptcy, you may want to consider holding off for a few months. The longer ago that the debt was borne, the less likely the creditors are to object to a discharge. The downside of course is that if you aren’t paying on the loans, the creditors are most likely going to take collection actions between now and your bankruptcy filing. That may always be the better option if filing now means that the debt isn’t wiped away.

Also keep in mind that if you put up many assets as collateral for a loan (whether for wagering debt or otherwise), the lien against that asset remains valid. So, while you no longer have a personal obligation to repay the loan after discharge, the creditor can still repossess the asset supporting the loan.

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