Creditor Objections to a Chapter 7 Bankruptcy Discharge

If you are thinking about filing for Chapter 7 bankruptcy in the Oak Park area, you may have heard that creditors have the opportunity to object to your discharge. It is important to know that an objection to your discharge is distinct from a creditor asking questions at the meeting of creditors (which is also known as the 341 hearing). Should you be worried that you will not be able to have a discharge in your consumer bankruptcy case because a creditor will object? We want to say more about the objection to discharge, why it happens, and whether it is something that may apply in your case.

Learning More About Discharges in a Consumer Bankruptcy Case
To understand what an objection to discharge is and why it can happen, you will need to understand clearly what a bankruptcy discharge is. As the U.S. Courts website explains, a bankruptcy discharge “releases the debtor from personal liability for certain specified types of debts.” To put it another way, the discharge wipes out debts. It is often the reason that most people ultimately file for Chapter 7 bankruptcy and, in some cases, for Chapter 13 bankruptcy. It means that the debtor is no longer responsible for debts that are dischargeable once the discharge occurs.

You should also know that a bankruptcy discharge is permanent. Accordingly, once a debtor receives a discharge, creditors are barred from coming after the debtor for any debts that have been discharged. In a Chapter 7 case, discharges usually happen 60 days after the 341 hearing, or about four months following the date that the debtor files a bankruptcy petition. A discharge in a Chapter 13 case takes much longer, and the discharge date typically depends upon the time period specific in the Chapter 13 repayment plan.

To be clear, a discharge means that a debtor is no longer responsible for debts. Why would a creditor object, and at what point in the process can this occur?

Objections to Discharge Under Certain Circumstances
First and foremost, a creditor cannot simply object to a discharge because that creditor is angry or frustrated that you have filed for consumer bankruptcy. Rather, an objection to discharge almost always occurs only in situations in which the creditor suspects that the debtor has engaged in fraudulent acts or other behavior prohibited under the U.S. Bankruptcy Code.

Examples of situations in which a creditor may object to a discharge can include, for example:

• Debtor committed fraud in his or her bankruptcy filing, which could include hiding assets or failing to report certain assets;
• Debtor failed to properly provide tax documentation or other information;
• Debtor used his or her credit card to get substantial cash advances prior to filing for bankruptcy and seeking to have the credit card debt discharged; and/or
• Debtor used his or her credit card to pay non-dischargeable debts.

These are some instances of situations in which the creditor may object to the discharge. In many cases, the debtor can correct the problem if there was a technical error that was unintentional. You can avoid errors that can result in a creditor objecting to a discharge by working with an experienced bankruptcy lawyer on your case.

Contact a Bankruptcy Lawyer in Oak Park
Consumer bankruptcy can be extremely complicated. If you have questions about filing for personal bankruptcy, you should speak with an Oak Park bankruptcy lawyer about your situation. Contact the Emerson Law Firm to learn more.


See Related Blog Posts:

Is Current Bankruptcy Law Hurting Disabled Veterans and Other Vulnerable Consumers?
Understanding Authorized Users and Consumer Bankruptcy