Repaying a Debt After Bankruptcy

There are many reasons you may want to repay a debt that has been discharged through Bankruptcy.  Whether it is an obligation to a family member, friend, or a local creditor, there is no prohibition against repaying a discharged debt.  The U.S. Bankruptcy Code provides, "Nothing contained in. . . this section prevents a debtor from voluntarily repaying any debt."  11 U.S.C. § 524(f).  You are free to make voluntary payments on all or part of your discharged debts.  This is especially important for money owed to friends and relatives. 

The Bankruptcy discharge is actually a court injunction directed at your creditors.  The discharge injunction prohibits creditors from taking collection actions to collect a discharged debt.  This injunction includes letters, phone calls, and any other request for payment.  Violation of this injunction may result in a contempt of court charge and serious penalties.

Making voluntary payments to a creditor after Bankruptcy does not invalidate the discharge order and does not create a new legal obligation.  The creditor is still prohibited from contacting you in any way and cannot take any collection action against you, including sending you a bill or even encouraging new payments on the old debt.  In this case, "voluntary payment" means a payment free from creditor influence or inducement.

Any payments you make on a discharged debt are the result of a moral obligation, as the legal obligation to pay the debt has been discharged by the Bankruptcy Court.  In a Chapter 7 Bankruptcy, for example, you are free to pay whomever you want.  The Seventh Circuit has held that "Debtors who file under [Chapter 7] can dispose of their post-petition earnings as they choose, including voluntary repayment of debts otherwise dischargeable in bankruptcy."  In re Hellums, 772 F.2d 379, 381 (7th Cir. 1985).

If you are interested in eliminating your debts through Bankruptcy, but wish to make voluntary payments after your discharge, it is crucial to consult with an experienced Bankruptcy attorney to discuss your legal options.  To schedule a FREE legal consultation with the Law Office of Nicholas R. Westbrook, please call (713) 893-6204.  Mr. Westbrook is an experienced and dedicated Houston Bankruptcy lawyer who will meet with you at one of his convenient locations around Houston and explain the Bankruptcy process.  He can help you file for Chapter 7 Bankruptcy or Chapter 13 Bankruptcy, depending on your situation.  Stop letting debt ruin your life.