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Bankruptcy > For Debtors > After Bankruptcy

What is a “discharge” from bankruptcy?

A “discharge” from bankruptcy is the Court order stating that the debtor has met all of the requirements of the debtor’s bankruptcy and all the debts subject to the bankruptcy are considered eliminated.  Any debt that is discharged no longer needs to be paid and the creditor may never take any action against an individual for collection of a discharged debt.

In all bankruptcies there is some debt that is not dischargeable and the individual will continue to have to pay it even after a discharge.  These debts are debts for payment of child support, alimony, criminal restitution and fines, student loans (depending on the type) and most taxes (sometimes can be discharged, but is rare).  In addition, if a creditor believes that the individual has committed fraud by transferring property prior to filing bankruptcy or hidden assets, the creditor may ask the bankruptcy court to make the creditor’s debt non-dischargeable which means that the individual would have to pay that debt no matter what the outcome of the bankruptcy.

How does bankruptcy affect my credit report?

Bankruptcy will be on an individual’s credit report for 10 years after the date of the bankruptcy discharge.  However, if individuals are in a situation where bankruptcy is appropriate, chances are their credit is not good anyway.  Bankruptcy affords individuals a way to get a clean slate and re-establish their credit.  All creditors are aware of the bankruptcy code.  Many Creditors extend credit to individuals that have filed bankruptcy because the creditor knows that a person discharged from bankruptcy may not file a Chapter 7 case for 8 years after discharge and may only file a Chapter 13 (which would allow for the Creditor to be potentially re-paid some amount) in certain other circumstances.  An individual that is discharged from bankruptcy has less debt than those who are struggling to pay their bills under high interest rates, late fees and overlimit fees.

The information provided in this website is meant only as a general description of the current laws as of the date of the writing. It is not meant to be an exhaustive discussion of all the nuances of the law and is intended to be only an overview. Many issues may appear simpler than they are, and an individual should always contact an attorney to obtain a complete, accurate interpretation of the law given the individual's particular circumstances. Thompson Law Group, P.C. makes no representations as to how the law would affect a particular situation and intends only to illustrate areas of concern and give general information.

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