When you file for bankruptcy, it’s important to understand the different facets of this process that can impact the outcome of your case. One such matter that many are unsure of is the difference between a discharge and dismissal. While these two terms may sound familiar, they are incredibly different and can drastically impact how your case is handled. If you are going through bankruptcy, the following blog explores what you should know about these difficult matters, including the importance of working with Franklin County bankruptcy lawyers to guide you during this process.
How Do a Bankruptcy Discharge and Dismissal Differ?
One of the primary goals of bankruptcy is to receive a discharge. Essentially, when a debt is discharged, it means that a court order has been issued stating that you are no longer legally responsible for repaying the debt. Though the debt technically still exists, your obligation is erased. Additionally, a creditor cannot continue collection efforts for discharged debts. A discharge is granted at the end of a bankruptcy case, after all eligible assets have been liquidated if filing for Chapter 7, or you have made your final Chapter 13 payment. Once you receive a discharge, your case is officially closed.
A bankruptcy discharge, on the other hand, occurs when your case is closed before your debts are discharged. Generally, you’ll find that before a dismissal occurs, you will be issued a letter explaining that your case is on the verge of dismissal, and informing you of the matter that you must fix. If you fail to remedy the issue in time, your case will be dismissed, and you will not receive any form of relief. Most often, filing errors, missed payments, and failure to complete credit counseling courses are reasons for a dismissal. You should note that if your case is dismissed, the automatic stay will lift, meaning your creditors can resume collection efforts, including wage garnishment and lawsuits.
What Should I Do if My Case Is Dismissed?
In the event your bankruptcy case is dismissed, it’s important to understand that you have legal options. If you are given a dismissal without prejudice, you’ll find that this allows you the opportunity to immediately refile your case. Typically, you’ll find that most cases are dismissed in this matter, and it essentially means as if your case was never filed.
However, if your case is dismissed with prejudice, this means that you are generally prevented from filing for 90 days to one year.
Regardless of the circumstances under which your bankruptcy case is dismissed, ensuring you connect with an experienced attorney at Cousino & Weinzimmer LLC. Our firm is committed to guiding you through these difficult times to help you fight through these matters. Connect with us today to learn how we can assist you.
