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Post-Discharge Actions

Can I Pursue My Claim After Bankruptcy?

Not generally. The bankruptcy discharge granted to an individual debtor prevents a creditor whose claim is dischargeable from pursuing the debtor anytime in the future with respect to that claim.

Secured Claims

If a creditor’s claim is supported by a lien, the lien survives bankruptcy as a claim on the property to which it is attached before bankruptcy, unless a judge avoided the lien during the bankruptcy.

A creditor who wants to foreclose on a lien must either get relief from the automatic stay or wait until the property with the lien attached is no longer property of the estate. Property leaves the bankruptcy estate when:

  1. It is exempted

  2. It is abandoned by the trustee

  3. The case is closed

Claims Against Corporations

A corporation in a Chapter 7 doesn’t get a discharge. The bankruptcy liquidates the assets, but the claims that remain unpaid remain debts of the corporation. The claim is almost always worthless since a bankrupt corporation almost never acquires assets in the future from which the claim can be paid.

A Chapter 11 confirmed plan replaces the creditor’s prepetition claim with the rights created in the plan. It is a new contractual obligation between debtor and creditor.

Liability Of Others

The debtor’s discharge, or the automatic stay in a Chapter 7 or Chapter 11 case, only protects the debtor. Neither the discharge nor the stay prevents a creditor from asserting the claim against others who are liable on the claim. In Chapter 13, the automatic stay does extend the court’s protection to co-debtors liable to the debtor on consumer debts.

We encourage you to call 515-421-9068 or use our online contact form to schedule a free one-hour consultation with a lawyer who emphasizes on clear communication and cost-efficient solutions. We will review your situation and recommend an effective course of action.