Chapter 7 Bankruptcy Discharge

Section 12 of "The Chapter 7 Bankruptcy Process":
Receive Discharge

The main reason one goes through this process is in order to receive a Chapter 7 bankruptcy discharge. When a debt is discharged, the debtor is no longer legally required to pay the debt.

When a discharge is granted, the Court will send a copy of the order to all parties listed on the matrix, including the debtor, his or her attorney, creditors, and bankruptcy trustee. The debtor should file this documents away in a safe, accessible place. Click here to view a sample copy of a Chapter 7 bankruptcy discharge.

Not all types of debt are dischargeable. If a debt is not discharged, the debtor is legally obligated to repay it. For almost every rule, there is an exception, so talk to your attorney regarding what debts will or will not be discharged for your particular situation.

Examples of debts that are generally not subject to a Chapter 7 bankruptcy discharge include:

• most taxes and tax-related debts
• debts for domestic support obligations, such as child support and alimony
• most student loans
• governmental fines and penalties
• debts for malicious or willful injury to others or others' property, such as criminal restitution
• debts resulting from personal injuries caused by driving while intoxicated
• debts owed to most tax-advantaged retirement plans
• debts that the debtor has reaffirmed in compliance with the Bankruptcy Code, such as a mortgage or auto loan
• some debts that are not listed properly in the bankruptcy schedules

A Chapter 7 bankruptcy discharge is generally entered approximately four months after the bankruptcy petition is filed. Entry of the bankruptcy discharge may be delayed for various reasons, including the following:

1. the failure of the debtor to comply with bankruptcy requirements, such as attending a pre-discharge bankruptcy education course;
2. a complaint objecting to discharge filed by a creditor or other interested party;
3. a motion to extend time to file complaint objecting to discharge filed by the bankruptcy trustee or other party (for example, in an effort to make the debtor cooperate or to turn over assets);
4. a pending motion to dismiss (for example, if bankruptcy fraud or abuse is under investigation).

A Chapter 7 bankruptcy discharge may also be revoked after it is granted. For example, if the debtor fails to turn over an asset to the bankruptcy estate, the trustee may file a complaint to revoke the debtor's discharge for failure to cooperate.

Although the debtor is not legally obligated to pay a debt after it is discharged, he or she may voluntarily repay any discharged debt. The creditor then may accept or reject the payment at its own discretion.

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