You need to be able to tell creditors who contacted you about your bankruptcy and what actions were allowed by law.
After going through financial turmoil and being proactive in getting out of debt, you can expect a peaceful and prosperous life.
- Creditors who violate the discharge are a threat to the bankruptcy’s promise of a fresh start.
- What was released?
- What was actually discharged?
Not all creditors are discharged in bankruptcy.
The discharge also removes your personal liability but does not erase creditors’ liens against your assets.
The discharge order is not enough to tell what was discharged.
Here are some guidelines for former creditors to follow once you have your discharge.
Zombie Debt Is Back From the Dead
Debt that has been discharged in bankruptcy is often part of a sale in a world where creditors are unable to collect their debts.
The buyer of the debt does not have any rights that the seller did. If it is still dischargeable if it was paid off by the seller,
While innocent attempts to collect debts are still illegal, bankruptcy judges won’t grant much relief unless the debt buyer is informed that the debt has been discharged.
You now have a suit to impose sanctions.
Liens After Bankruptcy
A secured creditor’s interest is your pre-bankruptcy assets, except if the bankruptcy judge nullifies a lien.
Many discharge suits against secured lenders are successful because lenders don’t care what their letters say about your rights and obligations.
Reaffirm Your Debt
To make sure that the car lender does not repossess the vehicle because you have discharged it, the debtor must reaffirm your debt. Your car will then be safe from repossession.
However, if you fall behind in the reaffirmed debt, it will be as though you have never filed for bankruptcy. You can be sued by the lender for the difference, and the lender can repossess the car.This article was written by Alla Tenina. Alla is the best bankruptcy attorney in Los Angeles California, and the founder of Tenina Law. She has experience in bankruptcies, real estate planning, and complex tax matters. The information provided on this website does not, and is not intended to, constitute legal advice; instead, all information, content, and materials available on this site are for general informational purposes only. Information on this website may not constitute the most up-to-date legal or other information. This website contains links to other third-party websites. Such links are only for the convenience of the reader, user or browser; the ABA and its members do not recommend or endorse the contents of the third-party sites.