Collections Are Calling About a Debt That Was Discharged in Your Bay Area Chapter 7 Bankruptcy? Call Our San Jose Bankruptcy Attorneys Right Away

Debt Collection in Violation of Bankruptcy DischargeIt happens. Perhaps it’s due to sloppiness on the part of the creditor in failing to enter into their computers the fact that they received a copy of your bankruptcy discharge order from the Bankruptcy Court.  Or perhaps it’s the result of the fact that debt collection companies buy and sell consumer debts like Wall Street packages, repackages and peddles toxic derivatives. But the fact is that often a collection company buys a debt that was discharged in bankruptcy and then knowingly attempts to collect that discharged debt.  Is this illegal? Of course it is. The question is how best to defend against such illegal attempts to collect on discharged debt?

The bankruptcy discharge is a permanent court injunction against any and all efforts by creditors to collect that debt. But like most civil court injunctions, the Bankruptcy Court doesn’t itself police its injunction. It’s up to the former bankruptcy debtor to sue the collector for violating the discharge injunction. Such a violation of the bankruptcy discharge is contempt of the court’s order, and the Bankruptcy Court will award sanctions against the collector found to violate the discharge if only the former bankruptcy debtor brings the violation to the court’s attention.

Our Bay Area bankruptcy attorneys take creditor violations of the bankruptcy discharge very seriously, particularly where such violations constitute willful or repeated attempts to collect debts known by the collector to have been discharged in bankruptcy. Many times a stern warning letter from us will convince the collector to cease its unlawful attempts to collect the discharged debt. However, if the debt collector refuses to heed such warnings, we will file a lawsuit against them in the Bankruptcy Court where our client received his or her bankruptcy discharge. This type of suit is an adversary proceeding for damages and contempt of the discharge injunction. The Bankruptcy Court, by virtue of its broad powers under Bankruptcy Code section 105(a), can award damages, attorneys’ fees, and sanctions against the debt collector for its violations of the discharge.

If you received a bankruptcy discharge in Chapter 7 or Chapter 13, and a debt collector is attempting to collect on a debt that was listed in your bankruptcy petition, give our San Jose bankruptcy lawyers a call  for a free consultation. Depending on the facts surrounding your bankruptcy and the debt in question, we may agree to represent you in a suit against the debt collector at no cost to you.

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