BloombergBusiness has published an interesting article about the sale of discharged debts. Many consumers do not know that banks will sell debts that have been discharged in bankruptcy. After all, shouldn't they be worthless?
However, many debt buying companies will pay for large bundles of discharged debts and attempt to collect them. This practice denies consumers their fresh start in bankruptcy. In particular, some debt buyers will give a purchased debt a new account number and report it to credit bureaus. When the consumer attempts to obtain a mortgage or vehicle loan, they often find out that the re-reported debt is what is preventing them from getting credit.
Many are faced with a difficult choice--pay the discharged debt and obtain the credit that they need, or hire an attorney and fight. The second option, obviously, takes more time and can be costly.
That said, asserting and defending your legal rights is worthwhile. The problem for many consumers is that they cannot wait for the legal process to resolve. In the meantime, the damage is still being done by the inaccurate credit reporting.
Rather than re-report the Bloomberg article, I highly advise giving it a read.