Filing for Chapter 7 bankruptcy is a great way to get most or all of your debts discharged at the end of the bankruptcy. And while you might think you are in the clear when it is over, it is important to know that a bankruptcy trustee or creditor can still challenge some of those discharges in your bankruptcy case — otherwise known as objections.
If an objection is filed with the bankruptcy court and upheld you will be responsible for repayment of your debt. So who can object to your discharge?
Creditors – more often than not it is a creditor that objects to a discharge and it is usually an objection to the discharge of its own debt.
U.S. Trustee – can object to all of your debts being discharged, usually because of a bankruptcy code violation.
Chapter 7 bankruptcy trustee – this trustee can object to a discharge of a specific or particular debt or to the discharge of all your debts. This is usually on the grounds of you committing bankruptcy fraud.
As just highlighted, the two types of objections are either against the discharge of a particular debt or the discharge of all of your debts.
If a particular debt is objected it will not affect any of the other debts in your bankruptcy case. Even if the bankruptcy court orders the discharge of all of your debts, an objection to a particular debt can still be made.
An objection to all of your debts usually comes on the basis that fraud was committed on your part in connection with you bankruptcy case. You can end up committing fraud in many ways.
One way is by lying to the judge or bankruptcy trustee during hearings. Another, is to transfer the title of property to someone else in the hopes it will not be included in the bankruptcy case. A third form of fraud would be simply be lying on your bankruptcy petition and schedules.
If you are convicted of bankruptcy fraud the court will most certainly deny the discharge of your debt. Furthermore you may also end up sentenced to prison.
At the end of the day, an objection to the discharge of your debt can really negate the positive feeling of finishing your bankruptcy case. In order to make sure you are in the best possible position and that creditors do not try and take advantage of your situation, you should hire an experienced bankruptcy attorney.
In New Jersey, Joel R. Spivack, Esq., has helped many clients get the fresh financial start they deserve. He can provide you with sound advice when it comes to filing for bankruptcy. Call today for a free face-to-face initial consultation at 856-488-1200.
The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney/client relationship. If you are seeking legal advice, please contact our law firm directly.