When you file for bankruptcy, you will be required to disclose your debts—which are also called creditor claims in bankruptcy court—and classify them as secured (home mortgage), unsecured (credit cards), priority unsecured (child support, alimony), or nonpriority unsecured (credit cards, medical bills). Priority unsecured debts cannot be discharged in a Chapter 7 bankruptcy, and you will remain responsible for them after your Chapter 7 bankruptcy. Priority unsecured debts also cannot be discharged in a Chapter 13 bankruptcy, and must be paid in full in a three-to-five-year repayment plan.

In Illinois, as in all states, when filing for bankruptcy, individuals are required to list all of their debts and categorize them according to their nature. Secured debts are those tied to an asset, like a home mortgage. Unsecured debts are not tied to any asset and include credit card debts and medical bills. Among unsecured debts, there are priority unsecured debts, such as child support and alimony, which are given special status. These priority debts cannot be discharged in a Chapter 7 bankruptcy, meaning the debtor remains responsible for them even after other debts have been cleared. Similarly, in a Chapter 13 bankruptcy, priority unsecured debts are not dischargeable and must be paid in full over the course of the repayment plan, which typically spans three to five years. It's important to accurately classify debts in the bankruptcy process, as this determines how they will be treated. An attorney can provide guidance specific to individual circumstances and the nuances of state and federal bankruptcy laws.