Monday, September 21, 2009


The bankruptcy discharge is a court order granting a debtor a discharge from prepetition debts owed to most creditors. The discharge prohibits any attempt to collect from the debtor a debt that has been discharged. For example, a creditor is not permitted generally to contact a debtor by mail, phone or otherwise, to file or continue a lawsuit, to attach wages or other property, or to take any other action to collect a discharged debt from the debtor. A creditor who violates this order can be required to pay damages and attorney’s fees to debtor.

However, a creditor may have the right to enforce a valid lien, such as a mortgage or security interest, against the debtor’s property after the bankruptcy, if that lien was not avoided or eliminated in the bankruptcy case. Also, a debtor may voluntarily pay any debt that has been discharged.

The chapter 7 discharge order eliminates a debtor’s legal obligation to pay a debt that is discharged. Most, but not all, types of debts are discharged if the debt existed on the date the bankruptcy case was filed. If a case was begun under a different chapter of the Bankruptcy Code and converted to chapter 7, then the discharge applies to debts owed when the bankruptcy case was converted.

Some of the common types of debts which are NOT discharged in a chapter 7 bankruptcy case are: debts for most taxes; debts incurred to pay nondischargeable taxes; debts that are domestic support obligations; debts for most student loans; debts for most fines, penalties, forfeitures, or criminal restitution obligations; debtors for personal injuries or death caused by a debtor’s operation of a motor vehicle while intoxicated; some debts not properly listed by a debtor; debts that a bankruptcy court specifically has decided are not discharged; debts for which debtor has given up the discharge protections by signing a reaffirmation agreement; and debts owed to certain pension, profit sharing, stock bonus, and other retirement plans. Source: Official Form 18J.

Warmest Regards,

Bob Schaller

Your Bankruptcy Advisor Blog
By: Attorney Robert Schaller (Bob's bio) of the Schaller Law Firm

Bob is a member of the National Bankruptcy College Attorney Network, American Bankruptcy Institute and the National Association of Consumer Bankruptcy Attorneys.

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