Bankruptcy is a complex area of law and there are a lot of moving parts to a bankruptcy case. The end goal of filing for bankruptcy is to receive a Bankruptcy Discharge Order from the bankruptcy court, which erases your legal obligation to pay back your dischargeable debts.
- Dischargeable debts are debts that can be erased through bankruptcy.
- The most common debts that are dischargeable include credit cards, medical bills, personal loans, utility bills, and certain older tax debts.
The Bankruptcy Discharge Order is a court order that releases you from personal liability on certain debts. You are no longer legally required to pay back any debts that are part of your bankruptcy discharge. Further, the creditors of discharged debts can never legally attempt to collect payment on those debts.
Can Creditors Object to the Bankruptcy Discharge?
The short answer is yes.
In Chapter 7, a creditor may file an objection to the debtor’s discharge. The bankruptcy trustee assigned to the debtor’s case or the U.S. trustee may also file an objection to discharge. However, the vast majority of Chapter 7 cases proceed without objection from creditors or trustees.
In Chapter 13, a creditor can object to confirmation of the Chapter 13 repayment plan, but cannot object to discharge if the debtor has completed making all plan payments.
Chapter 7 Bankruptcy Discharge
People who file for bankruptcy protection (debtors) do not have an absolute right to bankruptcy discharge. A creditor or trustee may file an objection to the debtor’s discharge.
After a case is filed, the bankruptcy court sends a notice to the creditors informing them of the deadline for objecting to the discharge and alerting them to the date, time, and location of the Meeting of Creditors (which creditors rarely attend). To object to the debtor’s discharge, a creditor must file a complaint with the bankruptcy court prior to the deadline set out in the notice. This starts a lawsuit that is called an “adversary proceeding” in bankruptcy.
As we noted above, the vast majority of Chapter 7 cases proceed without objection from creditors or trustees. In most cases, there are no compelling reasons for an objection to discharge to be filed. Generally, so long as a debtor is truthful and accurate in the bankruptcy petition, did not incur significant debt right before filing, did not transfer assets before filing, and is not hiding assets – then it is not likely that a creditor will spend the time or money to object to the discharge.
Consult with a Bankruptcy Attorney
We’re here to help you through your bankruptcy case from start to finish. It is our mission to ensure that you understand the power and benefits of bankruptcy. We’re here to answer all of your questions. Contact us right now (912) 351-9000 to schedule a free consultation. Together we will explore how bankruptcy can help you.
For over 35-years we have proudly served the people in Savannah, Richmond Hill, Hinesville, Pooler, Port Wentworth, Tybee Island, Clyo, Ellabel, Midway, Springfield, Pembroke, Brooklet, Garden City, and Ludowici, Georgia.
We are a debt relief agency. We help people file for bankruptcy relief under the U.S. Bankruptcy Code. Find out more about Bankruptcy in our guide: All About Bankruptcy.