With Chapter 7 bankruptcy, the court discharges your debts, which means you won't have to pay them. This can naturally lead to concerns that a creditor might retaliate, but fortunately, bankruptcy provides protections against that. It's important to know your rights before you file.
The Craig Black Law Firm specializes in bankruptcy filings and can walk you through what to expect. If you have questions about bankruptcy, give me a call at 678-888-1778 or complete my confidential contact form.
How Bankruptcy Discharge Works
Once a Chapter 7 bankruptcy is approved, an assigned trustee will review your debts and determine how each item should be handled. Once that decision has been made, the Federal Rules of Bankruptcy Procedure require that the bankruptcy court clerk send a copy of the discharge order to each affected creditor. Creditors cannot “opt out” of this federal order.
The bankruptcy order prohibits creditors from pursuing collections against a debtor. That means not only will your creditor be unable to contact you, but legal action is out of the question as well.
Existing Litigation and Bankruptcy
Some debtors enter bankruptcy with litigation already in place. It could be that one of your creditors or a debt collector filed a lawsuit, or maybe you had a liability case against you. Existing litigation should be listed as part of your filing paperwork so that the trustee can review it along with your other debts.
If your bankruptcy is granted, your legal case will be stopped in its tracks. But if a judgment has already been made, that judgment will be listed along with your other debts and reviewed to determine whether it's an exempt debt. If a lawsuit resulted in a lien against your property, you may need to clear the lien before the debt can be discharged.
Creditor Contact After Bankruptcy
Although bankruptcy should stop creditors from calling you, the phone may not stop ringing altogether. Some vendors pay for lists of those with past-due payments, and your name could be among them. Since these aren't your direct creditors, the court won't be able to do anything about it, but you can block these callers and avoid future harassment.
If a creditor violates the order and continues to contact you, though, there is something you can do. You can file a motion with the court, report the creditor, and ask the court to take action. The case may need to be reopened so that the court can enforce the bankruptcy violation. If found guilty, the creditor could be held in civil contempt, possibly resulting in a fine.
A Legal Partner on Your Side
Whether you're in the preliminary stages of filing for bankruptcy or a creditor has violated your bankruptcy order, an experienced attorney can help. Contact me at 678-888-1778 or complete my confidential online form to find out how I can help you with your bankruptcy case.
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