Who Do I Pay After Filing Chapter 7 Bankruptcy?

June 17, 2011

It is important to have a clear understanding of which bills to pay after your Chapter 7 bankruptcy case is filed. Of course, every case is different and the specifics of your case and your debts should be discussed with your attorney. However, in most Chapter 7 bankruptcy cases payments for unsecured debts are generally stopped, while payments on secured debts and household expenses are continued.

First, dischargeable unsecured debts, like medical bills and credit cards, will generally be included in your discharge. Unsecured debts are financial obligations that are not backed by property. A signature loan is unsecured, while a car loan is usually secured by the car. If you don’t pay, the bank repossesses your car. Because your unsecured debts will be discharged by the bankruptcy court, there is no negative consequence to nonpayment before the discharge. Additionally, after the bankruptcy case is filed, the creditor is prohibited from reporting anything negative on your credit report other than the inclusion of the debt in your bankruptcy.

Second, utility bills and household expenses should be paid. This includes your rent, your cell phone bill, your electric bill, etc. If you are behind on these bills and need time to catch-up, speak with your attorney regarding legal options. Monthly bills that are incurred after your bankruptcy filing date are not included in the bankruptcy case.

Third, pay secured debts that you wish to keep, such as your home mortgage or a vehicle loan. Failure to make these monthly payments may result in repossession after the bankruptcy case is concluded. Again, if you have trouble making these payments, speak with your attorney.

Finally, domestic support obligations such as child support must be paid. Likewise, it is a good idea to continue any non-dischargeable court-ordered payments.

The best advice is to discuss future creditor payments with your attorney when you sign your bankruptcy case. Your attorney can identify creditors that should be paid, and those that your can stop paying. 

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