A bankruptcy discharge is a court order released at the end of a Chapter 7 or Chapter 13 that takes from you the responsibility to pay off a financial debt. But to get this discharge, you have to complete all your requirements for your bankruptcy case. As soon as a financial debt has actually been discharged, the creditor is forbidden to take any collection activity on that particular debt ever again. That includes calling, sending letters, or taking legal action against the debt. On the other hand, creditors can enforce any type of liens connected to secured debts. They could still repossess and also sell any property connected to a lien, even after the associated debt has been discharged.
Conforming to the United States Courts, discharge for Chapter 7 bankruptcy normally takes up to 4 months after the date you file your bankruptcy petition. For Chapter 13, the discharge takes place after all the settlements under the bankruptcy plan have actually been made, which is in between three and five years. If you do not follow the financial management course offered to you, the court could reject your bankruptcy discharge.
Once you get released from debt, all your creditors, bankruptcy trustee and attorney will receive a copy of the order by mail. This order includes a notice that creditors must not attempt to collect on the debts, otherwise they will face punishment for contempt. You have to ensure that you keep a copy o this order together with all the other bankruptcy documents, so you do not need to pay to get a copy later. These copies might be useful when dealing with creditor who attempt to collect from you after the bankruptcy discharge.
If any kind of financial institution aims to collect a discharged debt from you, you could file a motion with the court and have the case reopened. If the court finds out about the discharge injunction, be sure, the creditor will be fined. If you have any doubts about fighting against the collectors – talk to an attorney who will be able to protect your rights. It’s always sensible to take some legal actions when sending a copy of discharge doesn’t help.
How Your Bankruptcy Discharge Affects Cosigners
Unfortunately, your bankruptcy will certainly affect any type of joint account holders or cosigners. While your obligation for financial debt is removed after bankruptcy discharge, the cosigner is on the hook for the whole balance of the debt. Your bankruptcy protection does not extend to your joint applicants or cosigners and they may be pursued or even sued by creditors. However, you could voluntarily make payments on the debt to guarantee that it’s paid completely, specifically if you received the benefit from the debt.
Bankruptcy Discharge as well as Your Credit Report
Bankruptcy discharge does not affect the credit reporting time limit for bankruptcy, which is seven years from the date of filing for Chapter 13 as well as ten years from the date of filing for Chapter 7. Accounts related to bankruptcy might be deleted from your credit report before the bankruptcy, specifically if the date of delinquency preceded your bankruptcy declaring. The bankruptcy, nevertheless, will be listed on your credit report in the public records section for the allowed time limit.
When everything is done right, the period when you get the bankruptcy discharge is standard. That’s why it’s important to work with a Chattanooga attorney to ensure the process goes fast and smoothly. With years of experience, Conner & Roberts, PLLC is able to develop the best strategy for you to become free of debt as soon as possible. Contact us for the initial consultation which is always free!