What Is a Bankruptcy Notice?

The discharge in a bankruptcy case is the final part of the bankruptcy process, and it is the action that releases you from the responsibility of paying your debt. The court's clerk sends you and your creditors a copy of the discharge order to inform you about the discharge. This is the bankruptcy notice.

Bankruptcy Discharge

When you file for bankruptcy and the court accepts your case, you receive the discharge for all allowable debts. (Some debts are not dischargeable under bankruptcy.) Receiving the discharge means that you are no longer liable for payment of the discharged debts and that you can start again. A discharge also means that creditors of the debts discharged cannot demand you to pay them. However, debts such as student loans, alimony, child support and some taxes you owe are nondischargeable debts. You are still responsible for the normal payment of these debts, and creditors can demand you to make payments.

Bankruptcy Notice

The bankruptcy notice is a copy of the order of discharge for your bankruptcy case. The bankruptcy court's clerk is required to mail a bankruptcy notice to all your creditors, the United States trustee, the trustee in the case and the trustee's attorney. He also is required to send a copy of the notice to you and your attorney, if you have one. The bankruptcy notice includes a list of all debts discharged in the bankruptcy case. This notice has the purpose of informing your creditors that the debts you owe them have been discharged and that they are prohibited from starting new collection actions against you. This notice also warns creditors that if they to do so, they can be punished by law. The time in which the clerk takes to send the notice does not affect its validity.

Chapter 7

As an individual, the main two types of bankruptcy you can file for are Chapter 7 and Chapter 13. If you file for Chapter 7 and your case is approved, you can receive the discharge for your debts typically four months from the time you filed your petition. A discharge in a Chapter 7 filing means that your debts are erased and that you do not need to pay them.

Chapter 13

In a Chapter 13 filing, a discharge actually means that you have paid most of your dischargeable debts. Chapter 13 is a type of bankruptcy that requires you to create a repayment plan in which you show how you can use your income and resources to pay your creditors if the court accepts your case and allows lower interest rates. The court then grants you a period of three years (or five years if your income is low) to put your plan into practice. The discharge comes after this period is over and is only granted for the debts you paid. After the process ends, creditors cannot take actions for the discharged debts, but any debts that are not discharged are no longer under bankruptcy protection and creditors can demand payment.


About the Author

Ronald Kimmons has been a professional writer and translator since 2006, with writings appearing in publications such as "Chinese Literature Today." He studied at Brigham Young University as an undergraduate, getting a Bachelor of Arts in English and a Bachelor of Arts in Chinese.