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Simple English definitions for legal terms

bankruptcy discharge

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A quick definition of bankruptcy discharge:

A bankruptcy discharge is a court order that releases a person from having to pay certain types of debts. This means that the person is no longer legally required to pay those debts and creditors cannot try to collect them. However, not all debts are discharged and if a creditor tries to collect a discharged debt, the person can ask the court to intervene. It's important to note that if a debt has a valid lien, the creditor can still enforce the lien to recover the property secured by the lien.

A more thorough explanation:

A bankruptcy discharge is a legal ruling by a bankruptcy court that releases a debtor from personal liability for certain types of debts. This means that the debtor is no longer legally required to pay the debts that are discharged. The discharge prohibits creditors from taking any collection action on discharged debts, including legal action and communication with the debtor.

For example, if a person files for bankruptcy and their credit card debt is discharged, the credit card company cannot continue to demand payment or take legal action to collect the debt.

However, not all debts are discharged. A valid lien that has not been avoided in the bankruptcy case will remain after the bankruptcy. This means that a secured creditor may enforce the lien to recover the property secured by the lien. Additionally, the court may revoke a discharge based on allegations, or a debtor who has received a discharge may voluntarily repay any discharged debt even though it can no longer be legally enforced.

Overall, a bankruptcy discharge provides relief to debtors by releasing them from certain debts and prohibiting creditors from taking collection action on those debts.

bankruptcy court | bankruptcy estate

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