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What can and cannot happen after a bankruptcy discharge

When a person in Arkansas receives a bankruptcy discharge, the discharged debts do not go away. Rather, the creditors who hold the discharged debts are enjoined from acting to collect them in any further manner. The prohibition extends to such collection activities as making phone calls, sending debt collection letters, filing civil lawsuits and garnishing the debtor's wages in an attempt to collect on the debt.

Similarly, both governmental and private employers are prohibited from discriminating against a debtor solely because of a discharged debt. Governmental agencies may not use the bankruptcy as a reason for firing a person, failing to hire them, or denying or rescinding a contract. Private employers may not discriminate against the debtor solely because of the bankruptcy in their employment decisions and actions.

Debtors may voluntarily choose to repay discharged debts if they wish. Often, a debtor will decide to do this in the event a creditor is a family member or friend. Creditors may not initiate this by themselves, however. In the event a creditor or employer violates the statutory injunction, the debtor may request his or her bankruptcy case be reopened. If the court finds the discharge was violated, the court may hold the violator in contempt and fine them.

The discharge of debts is meant to protect debtors while providing them with financial relief. In the event that a collector attempts to collect on a discharged debt or the debtor's employer discriminates against them because of a debt being discharged in bankruptcy, a bankruptcy attorney might help file the needed motions with the bankruptcy court. By notifying the court, the debtor may be relieved from further negative actions. His or her associated attorney's fees may also be ordered to be paid by the violating party in addition to associated fines and damages.

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