A bankruptcy discharge releases an individual debtor from personal liability for certain specified types of debts. In other words, the debtor is no longer legally required to pay the debts that are discharged. The discharge is a permanent order prohibiting the creditors of the debtor from taking any form of collection action on discharged debts, including legal action and communications with the debtor, such as telephone calls, letters, and personal contacts. Although a debtor is not personally liable for discharged debts, a valid lien that has not been avoided (i.e., made unenforceable) in the bankruptcy case will remain after the bankruptcy case. Therefore, a secured creditor may enforce the lien to recover the property secured by the lien. Corporations and similar entities are not eligible for a discharge.
With regard to the timing of discharge, each case is different. In a Chapter 7 case, a debtor’s discharge is usually entered between 90 to 120 days after the case was filed and the debtor complies with all obligations required by the Bankruptcy Code. The entry of a discharge may take longer if a debtor’s entitlement to the discharge is contested by the case trustee or creditors. In a Chapter 13 case, a discharge is entered upon the successful completion of the Chapter 13 plan, usually between 36 to 60 months following bankruptcy. In a Chapter 11 case, the debtor also formulates a plan of reorganization, therefore, the Chapter 11 process may take several years to complete.