With a Chapter 7 discharge, is a secured creditor allowed to continue seeking a judgment against me in a local court?

Asked over 1 year ago - Nashville, TN

The suit was originally filed before the Chapter 7 petition. The debt collection attorney requested a continuance instead of a voluntary nonsuit.

I have indicated my intention to surrender the secured property on my "Statement of Intention", I am willing to surrender the property, and I have in no way indicated otherwise.

Should I request that the local court dismiss the case, or are they allowed to continue seeking a judgement under the premise of obtaining or securing their property?

Attorney answers (4)

  1. Diane L Gruber

    Pro

    Contributor Level 18

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    Answered . Make sure both the court and the creditor's attorney has a copy of your Notice of Bankruptcy (issued by the court). If you have received your Notice of Discharge, send that, too. Creditor cannot get a judgment against you while BK is pending, nor after you get your discharge.

    Be sure to designate "best answer." If you live in Oregon, you may call me for more detailed advice, 503-650-9662.... more
  2. Alan D. Walton

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    Contributor Level 19

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    Answered . Any part of the suit that ask for you to pay money is stayed by the bankruptcy. The creditor needs to get permission of the court to go after the property while the case is active, but once it is over, the creditor can proceed with an action against the property only - if it asks you for money (court costs, attorney fees, etc.) then it is in violation of the discharge injunction.

  3. Andrew Berrien Love

    Contributor Level 5

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    Answered . I agree with Mr. Walton. There should be no action, judicial or non-judicial,
    Taken to collect a debt or recover the property during your Chapter 7, unless the Bankruptcy court grants relief from
    The automatic stay. The creditor can proceed
    Against the property after discharge but cannot ask you for money. Hope this helps.

  4. Madhu Kalra

    Pro

    Contributor Level 14

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    Answered . File notice of stay in the Stay court, so that State court record of your filing chapter 7 relief. If you have indicated your intentio to surrender, make sure to surrrender the properety within 45 days of filing chapter 7. Once the property s surrendered, creditor has no other remedy. Creditor cannot recover any thing more than secured property/item. Upon discharge of the debt, state court action is moot.

    Madhu Kalra Kalra Law Firm 23720 Arlington Avenue, Ste 5 Torrance, Ca 90501 (310) 325-9012

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