Chapter 7 Bankruptcy and Payday Loans

[hopej]

What is the name of your state?

Arizona. Can a consumer file bankruptcy on "payday loans"? I have been told that it is not possible in Arizona, and that criminal charges could be brought against anyone not repaying these loans, on bad check charges, as AZ is very hard on nsf's, etc. However, what if the loan store was notified of the consumer's inability to pay, and removed their right to electronically debit their checking account. When the loan store continued to debit the account, even after written notices, and phone calls, to save the overdraft charges, the account was closed. So, this was a loan. Not a bad check. What would happen if it was listed as debt in a Chapter 7 BK? I am in the process of converting from a Chapter 13 to a Chapter 7, and do not know what to do. Legally, I have to list it as one of my debts, but, MUST I list it as one I have to pay, after the discharge? I appreciate any help I can get. This has me stumped.

 

[Who's Liable?]

Of COURSE you can discharge paday loans in a chapter 7... Whoever told you contrary either worked for a payday loan office or should stick to their day job...

Paday loan places are the worst offenders of the BK code. They all think they are above the law and strong arm people with scare tactics to get them to pay back monies owed... Sure it is their money to demand back, but actually threatening people with jail time is illegal... Not to mention that once a person files BK, it is ILLEGAL for the payday loan people to even contact you about what you owe...

Are you filing pro se, or have an attorney?

You would file this as any other creditor in your matrix...

Be warned though. Payday loan companies are notorious for violating the automatic stay not to mention all the BK laws once it has been discharged. Do NOT be surprised that they contact you again post BK...