Violations of the Bankruptcy Discharge - Catching Creditors in the Act

November 7, 2008

The U.S. Bankruptcy Code states that once a debt has been discharged, no attempts may be made to collect on that debt. Unfortunately, it is not uncommon for unethical creditors and collections agencies to continue attempts to collect.

There are a few things to be aware of should you ever find yourself being hounded because of a debt that you no longer have any legal responsibility to pay.

From time to time, a creditor will sell an account that has been discharged in bankruptcy. The new owner of the debt will then attempt to collect from you. This is clearly illegal.

When reminded that the debt was discharged in bankruptcy court, the collectors may try to tell you that the discharge does not apply to that collections agency, since they were not listed on the original court documentation. To put it simply, they are lying. They are banking that your will not know any better and simply pay the debt. To make matters worse, they will often use intimidation tactics to further confuse you, hoping to force payment.

Another tactic employed by these questionable creditors and collectors is a little sneakier. Instead of calling or sending letters, they will report the discharged debt one or all of the credit reporting bureaus. By doing this, they lower your credit score and wait for you to discover this when you apply for credit. Should you find this to be the case, it is important to notify the credit bureaus of the inaccuracy to have it removed from your credit report.

Certain creditors and collections agencies are so ruthless in their pursuit of money that they will ignore rulings of the court and try to pressure you into paying debts that you do not owe. It is important to be aware that these companies are out there and what to do if you find one of them attempting to ruin your chances for a fresh start.

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