Debt Collectors and Debts Discharged in Bankruptcy: Five Things to Know



When an individual files for Chapter 7 or Chapter 13 bankruptcy in Illinois, they typically do so with the aim of receiving a bankruptcy discharge at the end of the bankruptcy case. Yet it can be confusing for a debtor to understand their rights in relation to a debt discharge and contact from debt collectors. For example, at what point, if any, can a debt collector attempt to collect on a debt that will soon be discharged in a bankruptcy case? Or, is there any time at which a debt collector can try to collect a debt that has been discharged? Our Oak Park bankruptcy lawyers can clarify your rights when it comes to debt discharges and debt collectors. The following are five things you should know about debt collectors and bankruptcy discharges in Illinois.

1. Debt Collectors Cannot Attempt to Collect Debts That Have Been Discharged

Once you have received a bankruptcy discharge — meaning that eligible debts have been discharged — debt collectors cannot attempt to collect those debts. As the Consumer Financial Protection Bureau clarifies, this kind of action by debt collectors likely violates federal consumer protection laws. Accordingly, if you are contacted by a debt collector about debts that have been discharged, you should feel confident making clear to the debt collector that they must stop this type of communication, and you should seek advice from a lawyer about your options for enforcing your rights.

2. Debt Collectors Cannot Try to Collect Debts While Your Bankruptcy Case is Pending

Debt collectors are also prevented from attempting to collect debts while your bankruptcy case is pending. As soon as you file for bankruptcy, the automatic stay will protect you from any actions by debt collectors (unless, in limited circumstances, a creditor can have the automatic stay lifted).

3. Debt Collectors Trying to Collect Debts During Your Bankruptcy Case are Required to Speak to Your Attorney

If you have an attorney during your bankruptcy case, debt collectors are not allowed to contact you directly. They must contact your attorney.

4. You Do Not Owe Debts That Have Been Discharged in Bankruptcy

To be absolutely clear, you do not owe debts that are discharged in bankruptcy. A bankruptcy discharge removes personal liability for these debts, and you no longer owe them.

5. Not All Debts are Necessarily Discharged in a Bankruptcy Case

While debt collectors cannot try to collect debts when a bankruptcy case is pending or after you have received a bankruptcy discharge, it is important to remember that not all debts can be discharged in a consumer bankruptcy case. Accordingly, if you filed for bankruptcy and received a discharge but had some debts that were non-dischargeable under the U.S. Bankruptcy Code, a debt collector may lawfully be able to continue attempting to collect these debts from you.

Contact an Oak Park Bankruptcy Lawyer

Whether you have questions about debts that have already been discharged in a bankruptcy case, or you need help with debt collection actions in a pending bankruptcy case or a bankruptcy case you plan to file, one of our lawyers can help. An experienced Oak Park bankruptcy lawyer can speak with you today about your case. Contact the Emerson Law Firm today for more information.



See Related Blog Posts:
Will the Automatic Stay Permanently Stop Debt Collectors?
Do I Need to Worry About Old Debt?

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