One of the most important parts of preparing for bankruptcy is the creation of a comprehensive list of your debts and creditors. This step ensures that the court notifies all of your creditors about the pending bankruptcy and give them a chance to respond. The automatic stay ends collection activity, so you might never hear from certain creditors again after your filing.
In most cases, creditors will not take action, which means that you can move forward with getting a discharge. However, sometimes a creditor takes issue with your bankruptcy filing and wants to continue pursuing the debt. Can a creditor stop your bankruptcy?
A third party can’t end your filing, but they can challenge their inclusion
The court can decide to dismiss your bankruptcy filing, but creditors cannot. All they can do is challenge the inclusion of their specific account in the bankruptcy filing. When a creditor suspects fraud or believes their debt represents a special situation, they can ask the court to consider their claims.
If the creditor files for an adversary proceeding, they will have a chance to ask the court to lift the automatic stay to allow for collection activity or to remove their account from your bankruptcy filing so that it won’t be subject to the discharge you receive. The courts will consider both sides when deciding how to respond.
You will have the opportunity to defend your decision to include the debt, although having experienced legal assistance with this process could increase your chances of success. Although some creditors will push back, most will accept your bankruptcy filing and cease trying to collect from you once you formally file your paperwork with the courts.