Dealing with a Debt Collector’s Threat to Fight the Discharge of Your Debt

Collection letter The goal of most bankruptcies is the discharge — the legal write-off of debts. If you are considering filing for bankruptcy to get a fresh financial start through a discharge of your debts, a collection agent telling you that you won’t be able to discharge that debt may well be troubling. So what is the truth about such threats?

Idle Threats

Most of the time if a creditor or collector tells you that a particular debt would not be discharged, they are wrong. They are likely lying to you or trying to confuse you in an effort to prevent you from filing for bankruptcy. It’s true that any creditor can challenge the discharge of its debt, but they almost never have the necessary legal grounds to make such challenges. So they very seldom do.

Debts that Aren’t Discharged

Most debts that you want to discharge in bankruptcy ARE in fact discharged. There are three broad categories of debts that aren’t discharged:

  1. Those that you choose not to discharge, usually because they are secured by something you want to keep, such as your vehicle or home, and you are willing to continue to owe the debt in exchange for your right to keep the collateral.
  2. Those that the law makes not dischargeable for various public policy reasons, such as child and spousal support, newer income taxes, most student loans and such.
  3. Those that were incurred through fraud, embezzlement or other similar bad behavior on the part of the debtor.

Putting the first category aside, most of the time a creditor or collector’s threat is not based on the second category — your debt is probably not one of the few types that can never be discharged. If that is what you are being told, and the debt is not a tax or student loan and does not arise out of a divorce, most likely the creditor or collector is not accurate.

But there are some other rare types of debts that may not be dischargeable in your situation, so ask the collector to tell you why the debt wouldn’t be discharged. Then talk to a bankruptcy attorney to find out if the debt can in fact be discharged.

Fraud and Other Bad-Behavior Debts

The third category listed above is the one that is usually at issue when a creditor threatens to challenge the discharge of a debt, telling you not to bother filing for bankruptcy because his or her company will act to prevent the discharge of its debt and you won’t be able to discharge it.

We said above that such threats almost never hold water because the legal grounds for such challenges are almost never present. Those necessary grounds are quite narrow, usually requiring you to have intentionally cheated the creditor in some way AT THE TIME the debt was incurred.

Proving Fraud

For a creditor to show that a debt was fraudulently incurred, he or she would have to show that you received or used credit by giving some specific false information to the creditor, AND you knew it was false, AND you gave it purposely to cheat the creditor into letting you get or use the credit, AND the creditor actually relied on that information to give you credit, AND the creditor was directly harmed by doing so. Again, the facts almost never support a creditor being able to establish all these in order to prove fraud. If not, the debt is generally discharged.

But be careful because sometimes the creditor’s task is made easier if the false information that you allegedly gave was implied. For example, when you write a check, doing so implies that you have money in the account to cover the check. So, often a bounced check or a similar use of credit without the intent to pay it back can be challenged as “fraud” for bankruptcy purposes.


Let me show you how Chapter 7 and Chapter 13 bankruptcy can help you solve your financial problems, with your vehicle loan(s) and with everything else. If you are in the Rockwall, Heath, Greenville, Lavon, Wylie, Mesquite, Royse City, Sachse or Rowlett, Texas, contact the Law Office of Carrie Weir. The initial consultation is free. Please call 972-772-3083 or use this form .

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