when an attorney tries to collect a debt after bankruptcy

Then the debt collector must contact the attorney instead of you while the bankruptcy is pending. You should also let your attorney know that you have been contacted by a debt collector. Once the debt is discharged by the bankruptcy court, the discharge permanently bars the creditor or debt collector from collection of the debt.

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What happens if a creditor tries to collect during my bankruptcy?

Jul 02, 2020 · Step One: If you have a bankruptcy attorney, tell the debt collector to contact your attorney. If you don’t have an attorney , identify the creditor and make sure it’s not a scam call . Get the name of the person you’re talking to, and the …

What should I do if I owe a debt in bankruptcy?

If someone tries to collect a debt after you file bankruptcy, you should immediately contact that person to let them know you have filed and, if available, provide them with your case number. If the creditor continues to harass you, your bankruptcy lawyer can file a motion with the bankruptcy court to report the creditor’s harassment and asking the court to reopen your case to address …

Can a debt collector call me if I have filed bankruptcy?

Oct 25, 2017 · You should also be sure the debt is in your list of debts and creditors filed with the bankruptcy court. If you are represented by an attorney for your bankruptcy, you should let the debt collector know this. Then the debt collector must contact the attorney instead of you while the bankruptcy is pending. You should also let your attorney know that you have been …

What happens when you file bankruptcy and get a discharge?

When you file for bankruptcy, the automatic stay prohibits almost all collection activity, including legal action, garnishment, and even contact by phone or mail in an attempt to collect a debt. While the automatic stay is very broad and applies to nearly every attempt to collect on a pre-bankruptcy debt, there are a few exceptions.

Can you be chased for debt after bankruptcy?

Creditors are allowed to carry on chasing you for payment of certains kinds of debts, including: secured debts, such as a mortgage or charging order on property. magistrates court fines. maintenance arrears.

What happens when a creditor continues to engage in legal action against a debtor when an automatic stay is in effect?

Generally, the court can sanction a violation of the automatic stay under its power of contempt (because the creditor violated the court's order). The court can impose fines, assess attorney's fees, and order the collector to pay damages. Punitive damages are not available.

What happens if a creditor violates the automatic stay?

The automatic stay is tantamount to a court order and, thus, violation of the automatic stay by creditors can have serious repercussions. Attempts to repossess property, suits in court and other actions taken in violation of the automatic stay are generally void. In other words, they are given no legal effect.Jul 28, 2016

What is automatic stay rule?

What Is an Automatic Stay? An automatic stay is a provision in United States bankruptcy law that temporarily prevents creditors, collection agencies, government entities, and others from pursuing debtors for money that they owe.

Bankruptcy's Automatic Stay

When you file for bankruptcy, the automatic stay prohibits almost all collection activity, including legal action, garnishment, and even contact by...

When Collection Violates The Automatic Stay

If an exception to the stay does not apply, and the bankruptcy court has not terminated or modified the automatic stay order, then a collector's at...

What to Do If A Creditor Violates The Automatic Stay?

You have several options if a creditor continues its collection actions against you in violation of the automatic stay.Tell the creditor about your...

What happens if you file for bankruptcy?

Once the debt is discharged by the bankruptcy court, the discharge permanently bars the creditor or debt collector from collection of the debt. Filing for bankruptcy can have long-term consequences so consult a bankruptcy attorney to learn more. It is important to recognize that lenders often have a right to repossess the collateral.

What to do if debt collector calls you?

If a debt collector calls and you have filed for bankruptcy, tell the debt collector. You should also be sure the debt is in your list of debts and creditors filed with the bankruptcy court. If you are represented by an attorney for your bankruptcy, you should let the debt collector know this. Then the debt collector must contact ...

Can a debt collector collect on a debt discharged in bankruptcy?

Can a debt collector try to collect on a debt that was discharged in bankruptcy? Debt collectors cannot try to collect on debts that were discharged in bankruptcy. Also, if you file for bankruptcy, debt collectors are not allowed to continue collection activities while the bankruptcy case is pending in court.

Can I share my PII with my employer?

Yes. No. Additional comment (optional) Please do not share any personally identifiable information (PII), including, but not limited to: your name, address, phone number, email address, Social Security number, account information, or any other information of a sensitive nature.

Can a lender repossess a car after bankruptcy?

If so, then the lender may still have that right after the bankruptcy discharge, if that debt is unpaid.

What happens if you file for bankruptcy and a creditor continues to collect?

If, after you file for bankruptcy, a creditor continues its collection actions against you, the creditor may be violating bankruptcy's automatic stay. Read on to learn when collection activities violate the stay and what you can do if a creditor continues to collect a debt in violation of the automatic stay.

What to tell creditors about bankruptcy?

Tell the Creditor About Your Bankruptcy. Typically, informing the collector of the bankruptcy protection will cause the collector to correct its violation. Many times the collector is unaware of your case (through error or negligence) and will stop collecting and correct its violation. For instance, if a collector garnishes your wages after ...

What happens if a collection violation of an automatic stay is not applied?

If an exception to the stay does not apply, and the bankruptcy court has not terminated or modified the automatic stay order, then a collector's attempt to collect a pre-bankruptcy debt is likely a violation of the automatic stay.

What happens if a credit collector continues to collect?

If a collector continues to collect violates the automatic stay, it may also violate other state or federal laws including: the Fair Credit Reporting Act. In order to collect penalties or damages under another law, you'll have to file a separate lawsuit.

What is automatic stay in bankruptcy?

Bankruptcy's Automatic Stay. When you file for bankruptcy, the automatic stay prohibits almost all collection activity, including legal action, garnishment, and even contact by phone or mail in an attempt to collect a debt. While the automatic stay is very broad and applies to nearly every attempt to collect on a pre-bankruptcy debt, ...

Can a court sanction a collector for violating an automatic stay order?

The court can sanction the collector for violating its automatic stay order if the collection action is "willful.". The action is willful if: the automatic stay order was in force and was actually violated. the collector knew of the bankruptcy case and either ignored the court's order or failed to immediately correct its action after learning ...

Does automatic stay apply to child support?

While the automatic stay is very broad and applies to nearly every attempt to collect on a pre-bankruptcy debt, there are a few exceptions. For instance, the automatic stay does not stop criminal cases, some child support actions, and certain eviction cases. The automatic stay does not apply to debts incurred after the bankruptcy case was filed.

Can a Creditor Collect on a Discharged Debt?

There are instances in which a creditor listed in your bankruptcy will still be granted the right to collect on a debt, but doing so requires the filing of specific documents with the court and receiving permission to move forward with the collection efforts despite the bankruptcy.

What Can You Do to Ensure Your Bankruptcy Goes as Planned?

The best thing you can do if you are concerned about aggressive creditors or you have a creditor trying to collect on a debt that was included in your bankruptcy is to work with an experienced attorney. He or she can anticipate any problems with your case and if anything unexpected arises, he or she will know what to do to ensure the best outcome.

What is the remedy for a debtor who is collecting?

If it is the original creditor collecting, then the debtor’s sole remedy lies in Bankruptcy Court, where under certain circumstances, a debtor can seek sanctions by the Bankruptcy Court.

What is the standard for FDCPA?

The standard for an FDCPA case is completely different from the “clear and convincing” and “willful” requirements used by the Bankruptcy Court. Under the FDCPA, debt collectors are held to strict liability. This means that as long as there is proof of the violation, the debt collector’s intent does not matter.

Is there a conflict between the bankruptcy code and the FDCPA?

Ocwen Loan Servicing, LLC held that there is no conflict between the Bankruptcy Code and the FDCPA. According to that case, when a debt collector tries to collect a discharged debt, it risks the violation of both the discharge order and the FDCPA.

Can debt collectors collect after bankruptcy?

Generally, debt collectors do not attempt to collect on debt after it is discharged in bankruptcy. However, what are a debtor’s rights if someone is trying to collect on a discharged debt?

Can you collect on a discharged debt?

Simply put, collection of the discharged debt is prohibited. Even though a debtor is no longer responsible for the debt discharged in their bankruptcy petition , occasionally there are creditors or debt collectors who attempt to collect on a discharged debt.

What is the goal of bankruptcy?

One goal of bankruptcy is to provide emotional relief from crushing debt. Any creditor who continues to contact you after a debt has been wiped out is breaking the law.

Do you have to pay a debt discharged in bankruptcy?

If a debt was discharged in bankruptcy, then you do not have to pay it. No matter what a creditor or collection agent tells you, a discharged debt is no longer your problem. Too many people get bullied by collection agents and think they must pay back a debt that was taken care of in bankruptcy.

Can creditors know if you filed for bankruptcy?

Some creditors might not have known you filed for bankruptcy (though they should have been notified by the court). They might also not know if the debt was discharged. These creditors should quickly stop contacting you once you provide proof of discharge.

What happens when you get discharged from bankruptcy?

When you get the discharge, the bankruptcy court imposes an injunction that prohibits the creditor from continuing to try to collect the debt from you.

Who sued the debtor in the Sherwood case?

The facts surrounding this case were complicated: After the discharge, the creditor (Sherwood) sued the debtor (Taggart), who was the creditor's former business partner, over ownership of the business. At the end of the litigation, the state court ordered Taggart to pay attorneys' fees. Taggart returned to the Federal Bankruptcy Court, ...

What is the background of the Taggart case?

Background of the Taggart Case. The court's decision in Taggart applies to situations when a creditor knows about a bankruptcy discharge and takes intentional actions because it believes the discharge doesn't apply to its actions.

What is the Supreme Court case in Taggart v Lorenzen?

Supreme Court considered the case of a creditor that unquestionably knew about a debtor's discharge order, but argued it had a subjective belief it was acting in compliance with that order while trying to collect from the debtor—and therefore wasn't in contempt.

Why is the Taggart decision important?

The Taggart decision might make creditors less concerned about dealing with borrowers on loss mitigation and other issues after a bankruptcy discharge because they'll be held in contempt only if there is no objectively reasonable basis for concluding that the creditor's conduct might be lawful.

What is discharge injunction?

A discharge injunction forbids a creditor from starting or continuing a collection action on a discharged debt, as well as prohibits the creditor from communicating with the consumer about the debt. An injunction also prohibits any attempt to enforce a judgment on a discharged debt through wage garnishment or a bank levy.

What did the Supreme Court decide in the case of Taggart?

In Taggart, the Supreme Court determined how a court should decide whether to sanction a creditor for collection activities when the creditor knowingly violates the discharge, but claims it was legally allowed to do so .

What to do if you filed for bankruptcy?

You May Need to Resort to Legal Action. So if you successfully completed a bankruptcy and are now on the receiving end of somebody’s telephone calls, dunning letters, or lawsuit regarding a debt that existed before you filed your bankruptcy, you need to talk to an experienced bankruptcy lawyer.

What happens if a creditor doesn't stop collection?

If the offending creditor will not voluntarily stop their collection efforts against you, legal action against them must be considered. In many instances, the creditor is required to pay your reasonable attorney fees — and you also may be entitled to compensation for their violation of the bankruptcy code.

What is a discharge order violating?

Creditors Who Ignore the Discharge Order are Violating Federal Law. When a creditor or debt buyer persistently tries to collect on a debt that was discharged in bankruptcy, that creditor is violating federal law, namely section 524 of Title 11 of the United States Code.

What happens if you list a debt and receive a discharge?

If you listed it and you received a discharge, then you are no longer responsible or liable for that debt. Most people think that that means no more telephone calls, dunning letters, or lawsuits from people trying to collect on that debt.

Do you owe anymore after bankruptcy?

Let’s repeat that: You don’t owe anymore after bankruptcy. So why are creditors still bugging you? The bankruptcy discharge eliminates your obligations to pay debts included in your bankruptcy filing. If you listed it and you received a discharge, then you are no longer responsible or liable for that debt.

Can creditors take your bankruptcy personally?

There are some creditors who may take your bankruptcy personally and persist in trying to collect on a discharged debt. Worse than these, however, are the debt buyers who know they are breaking the law and figure that the majority of people won’t put up a fight.