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What Is The Difference Between Discharge And Dismissal In A Bankruptcy Case?


In bankruptcy cases, as with many other legal matters, many words mean something other than their usual meanings.  On the surface, bankruptcy seems to mean not having any money, but the legal term is actually “bankruptcy protection,” where the court decides which of your possessions and how much of your money creditors cannot take away.  Therefore, bankruptcy is actually about having enough money to survive, instead of not having enough money to survive. The words “discharge” and “dismiss” both mean to send someone or something away, but in the context of bankruptcy law, they mean very different things from each other.  Discharging a debt is always good, but dismissing a bankruptcy case sometimes means that you are back to square one when it comes to figuring out what to do about your debts.  If you have been reading about bankruptcy filings but cannot make heads or tails of all the terminology, contact a Boca Raton chapter 7 bankruptcy lawyer.

Discharging Your Debts in Bankruptcy Is Always Good

Discharging debts is the goal of filing for bankruptcy.  When the bankruptcy court discharges a debt, it means that it forgives the debt.  When you file for chapter 7 bankruptcy, your eligible debts get discharged almost immediately.  When you file for chapter 13 bankruptcy, you must make payments toward your debts in the amount ordered by the court for three to five years before the court will discharge the remaining balance of the debts.

When the Court Dismisses Your Bankruptcy Case

If you bring a case to court, whether it is a bankruptcy filing or a lawsuit, and the court dismisses your case, this means that the court rejects it.  The main reason that the court dismisses chapter 7 bankruptcy filings is if the debtor’s statement of their assets and debts was inaccurate or incomplete.  The main reason that the courts dismiss chapter 13 bankruptcy filings is when borrowers fail to keep up with their payments.  The good news is that you can try again to resubmit the bankruptcy filing shortly after the dismissal if the court dismisses your case without prejudice.  If the court dismisses your case with prejudice, you must wait a year before refiling.

Can You Dismiss Your Own Bankruptcy Filing?

Just as it is possible to withdraw a divorce petition after you have filed for divorce, it is also possible to request that the court dismiss your bankruptcy filing.  Some people decide to do this when they find out that their debt payments in bankruptcy will be more expensive than they expected.  If is much easier to get the court to dismiss your chapter 13 bankruptcy filing at your request than it is with a chapter 7 bankruptcy case.  In other words, even if you try to get out of filing for bankruptcy, the court might tell you that you are stuck with the terms of the bankruptcy filing.

Find Out Which Debts You Can Discharge in Bankruptcy

The first step to making most of your debts disappear is to contact a South Florida bankruptcy lawyer.  Contact Nowack & Olson, PLLC in Boca Raton, Florida to discuss your case.

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