What happens if I forget to list a creditor in my bankruptcy filing?
This is one of the most common questions that I receive. Bankruptcy filings call for the inclusion of all of the Debtor’s assets and all of his/her debts. However, it is also widely understood that often times it is extremely difficult for a Debtor to obtain all of their debts and pertinent information for the current holders and collection agencies.
Unfortunately, a number of items such as medical bills, utility bills, debts personally guaranteed for a business, among other forms of debt, do not show up on credit reports. Therefore, it is contingent on the Debtor to have their current contact information or a recent billing statement. Particularly in cases with elderly debtors or those with a large amount of medical or business debts, this can be frustrating.
However, more often than not, even if a debt is not initially included within the Debtor’s petition at filing, and not added later on via an amended schedule, there is good news. These debts are normally considered presumptively discharged, as recent case law has shifted to putting the onus on creditors to search for a prior bankruptcy case, before commencing collection action.
This relative change in burden makes sense as most creditors have more resources and the capacity to be more vigilant in obtaining information than your average Debtor. In most instances, if a Debtor were to receive a call regarding debt after their bankruptcy discharge is issued, the case number will be sufficient to end those collection efforts. However, the debt must have still been incurred prior to the filing of the bankruptcy.
The recommendation is that every attempt is made at listing all debts known to the Debtor at the time of filing. At Masana Bankruptcy Law, we go back and forth with you to try to make sure that we don’t miss any creditors prior to filing.