When Filing Bankruptcy Who Is Notified?

By Tom Streissguth

When you file for bankruptcy protection, the court issues an "automatic stay" to protect you from collections, repossessions and lawsuits. You must list all your creditors when you file for bankruptcy, whether or not you are current on your payments and regardless of whether the loans are secured by property. The court then notifies the creditors using the list you provide.

Creditor Schedules and Notification

When you file for bankruptcy protection, you list your creditors on schedules D, E and F, depending on whether the loans are unsecured, secured or "priority" debts that can't be discharged in bankruptcy. The court then issues Official Form 9, Notice of Commencement of Case. This form is sent to all of the creditors you list in your schedules, along with an Order of Automatic Stay. The stay is a restraining order that prevents creditors from pursuing collections, making harassing phone calls, filing lawsuits or initiating repossessions and foreclosures while the bankruptcy case is open. Form 9 provides instructions and deadlines for filing documents as well as the date scheduled for a meeting of the creditors.

Omitted Creditors

If you fail to list a creditor on one of the schedules, that creditor won't be notified of your bankruptcy and the court won't issue an automatic stay. The court has no way of knowing who your creditors are unless you list them, or unless a creditor that you omitted comes forward with a claim. Any creditor that you've left off the schedules may file a Proof of Claim with the court, and you may be required to file an amended creditor schedule, or you could be found in contempt and your case may be dismissed.

Get a free, confidential bankruptcy evaluation. Learn More

Landlords and Rentals

If you are renting, you list your landlord as a creditor and the court will then notice the landlord. To remain in your dwelling, you must assume the lease, file a reaffirmation agreement with the court and keep your rent payments current. The agreement maintains the validity of the lease during the bankruptcy proceeding, but if you fall behind on rent, the court may grant an order allowing your landlord to evict you from the dwelling.

Priority Debts

If your wages are being garnished for a priority debt such as unpaid taxes or student loans, you must notify the court, who will notify your employer and the agency to which you are making payments. In the case of alimony or child support, the court will notify the agency collecting your payments as well as your ex-spouse. Personal debts that you list will also result in a notice to the lender, whether it's a business partner, family member or friend.

Reporting

Creditors who are notified of your bankruptcy will subsequently inform the credit bureaus that maintain your credit score. The bankruptcy will remain on your credit history for at least 10 years and will adversely affect your ability to secure loans of any kind for several years after the bankruptcy is discharged. The bankruptcy court will also notify creditors of a discharge or dismissal of the case. Bankruptcy filings and all related documents are public records that any business or individual can obtain upon request.

Get a free, confidential bankruptcy evaluation. Learn More
Schedule F Bankruptcy Discharge
 

References

Related articles

Will I Receive Notice to Vacate After a Bankruptcy Is Discharged?

Your landlord may not automatically evict you from your apartment just because you sought bankruptcy protection from your creditors. Your ability to keep your apartment depends on the type of bankruptcy that you file, the status of your rent payments to your landlord, and whether you keep your lease. Bankruptcy, however, does not prevent your landlord from removing you from the rental unit if eviction procedures were initiated before you filed your bankruptcy petition.

What Happens if a Bank Discharges a Home Loan During a Bankruptcy?

At the end of a bankruptcy case, you will receive a bankruptcy discharge that relieves you of all financial obligations toward the debt. The discharge also applies to home mortgages. Depending on whether you file for Chapter 7 or Chapter 13 bankruptcy, and whether you are current on your monthly payments, you may have several options if you would like to keep your home.

What Happens if I Can't Make My House Payments in Chapter 13 Bankruptcy?

Chapter 13 bankruptcy can give you a financial clean slate by erasing certain debts and giving you a chance to catch up on your payments. However, your mortgage is generally not one of the debts erased by bankruptcy. If you cannot stay current with all your house payments during your Chapter 13 bankruptcy, your lender can foreclose on your home.

Bankruptcy

Related articles

Can I Be Sued After Chapter 7?

If your debts have become unmanageable, you have the option to file for bankruptcy protection. Under Chapter 7 of the ...

Can Creditors Attempt to Get Money After a Discharge?

When you file a petition for bankruptcy, you are asking a federal court for protection from creditors and time to work ...

Chapter 7 Relief of Stay

In a Chapter 7 bankruptcy, a debtor petitions the court for protection from lawsuits and collection efforts. As soon as ...

What Happens to an Unsecured Loan After Chapter 13 Has Been Dismissed?

When you file for bankruptcy protection under Chapter 13, you are asking a federal court for protection from your ...

Browse by category
Ready to Begin? GET STARTED