What is the Bankruptcy Discharge?
A bankruptcy discharge relieves debtors from financial obligations of eligible debt, which often includes medical bills , credit cards and other qualifying debt that was included in your bankruptcy filing. The discharge also means creditors can no longer pursue or collect on the debt. Getting debt discharged may vary depending on what chapter is filed but in order for the debt to be granted a discharge in court, it must be included in your filing.
In Chapter 7 bankruptcy a creditor matrix filed by the bankruptcy attorney includes a list of creditors provided by the debtor. The list, which also includes creditor contact information, is used to contact creditors with a written notice that alerts them that a bankruptcy case has been filed. This is when the automatic stay goes into effect and prevents creditors from continuing collection efforts against the debtor. Several months later, a discharge order notice is sent to the debtor and creditor. A Chapter 13 bankruptcy may take longer to obtain a discharge since it includes repayment plan. The discharge is granted on remaining debt when the debtor has successfully completed the plan.
The discharge order is a court order signed by a judge, which prohibits collection from creditors on debts that were included in the bankruptcy filing. Creditors who try to collect from debtors after a discharge has been granted may be fined or sanctioned if found in contempt of court. It helps to have a copy of the discharge to forward to the creditor if they try to collect. This is often enough to stop their efforts but if they continue after a notice has been forwarded to them, contact your bankruptcy attorney .