When you file for bankruptcy, every debt you owe must be completely and accurately disclosed. The process does not permit you to pick and choose which debts you’d like to leave behind. Intentionally omitting debts or assets from your filing may prevent those debts from ever being discharged, the dismissal of your case, fines and even imprisonment.
The bankruptcy court requires that you engage in due diligence to determine your debts and to identify any and all potential creditors. This means that you are required to make a real effort to track down the money you owe and to whom it’s owed. You need to sit down and go through your credit report, account statements, collection notices, and other information pertaining to the existence of debt. When you sign your bankruptcy petition, and testify at the Meeting of Creditors, you are telling the Court that your petition is true, accurate and complete. This is important to you because bankruptcy courts will only result in the discharge of those debts where the creditor received notice.
What if you accidentally leave someone off the list? If you neglected to list a creditor and you have not yet received a discharge, it is possible to file an amended schedule of your debts to include the missing debts for a fee of $30.00. This means a new list of debts must be created and in some cases, a Motion for Leave to Amend Schedules must be granted. The Court will most likely allow the change but there is a filing fee associated with this process. The Court will then give your newly mentioned creditor time to object to having the debt discharged.
If, however, you have received your discharge and your case has been closed, then you are generally out of luck. There is some case law stating that with a no-asset Chapter 7 case (a case where a debtor didn’t have to turn over any property for the trustee to sell), the unlisted creditor has no remedy against the debtor because that creditor wouldn’t have received any funds even if they had been properly listed on the bankruptcy petition. This is, of course, not something you want to fool around with.
If you find yourself needing the services of a bankruptcy attorney, please call us at (904) 685-1200.