What Happens If I Forgot to List All My Bills for My Chapter 13 Bankruptcy?

By Tom Streissguth

Chapter 13 bankruptcy gives you protection from creditors while you meet the terms of a court-approved repayment plan. It's ideal for those who are unable to meet their debts, but have enough income to pay down their bills gradually. If you successfully complete a Chapter 13 repayment plan, you will earn a discharge of any eligible debts that remain once the repayment plan is complete. The initial step in this process is to file the petition for bankruptcy as well as a list of all your creditors.

Listing Creditors

The federal bankruptcy laws require you to list all creditors when you file your initial bankruptcy petition. For a Chapter 13 bankruptcy, there are three schedules you use to do this: Schedule D (Creditors Holding Secured Claims); Schedule E (Creditors Holding Unsecured Priority Claims); and Schedule F (Creditors Holding Unsecured Non-Priority Claims). By filing these schedules, you notify the court and creditors of your bankruptcy filing; if you fail to list any creditor, that creditor will not receive notice of the bankruptcy or court-imposed automatic stay on collection efforts.

'No Asset' Cases

A Chapter 7 bankruptcy discharges your debts after a bankruptcy trustee seizes and sells your non-exempt assets. A Chapter 7 bankruptcy is a "no asset" case if you don't have property for the trustee to seize; however, even in such cases, the court may discharge all of your eligible debts even if you failed to list some of them in your initial filing. Nevertheless, if you omit a creditor from the schedules, it's best to file an amended schedule of creditors to ensure the automatic stay and eventual discharge is applied to all eligible debts and creditors.

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'Asset' Cases

In a Chapter 7 "asset" case, in which you declare non-exempt property to the court for the trustee to subsequently sell, you must file an amended schedule of creditors if you forget or otherwise omit one. If you fail to do this, the court will not extend the automatic stay to those creditors or discharge the debt you've omitted, and may even dismiss the case if it finds you've acted in bad faith. That means all creditors would be free to demand payment or bring you to court.

Chapter 13 Amendments

Not listing a creditor in a Chapter 13 case is a serious matter; not only is the creditor free to pursue you for the entire debt, the debt will remain in force even after the court discharges your other listed debts. If a plan has not yet been drawn up, you can simply file an amended schedule of creditors. If a Chapter 13 plan is already in force, you must file a proposed amendment and allow all creditors time to file an objection — since the addition of debts to the plan may result in a change in the payment amounts. The trustee may require that an entirely new repayment plan is drawn up if new creditors are added.

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What Do I Do When I Leave Out a Creditor in a Bankruptcy?

References

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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 creditors. The court issues an automatic stay, meaning your creditors must stop all collection efforts and lawsuits against you. A trustee then draws up a repayment plan, which schedules monthly payments that will repay a portion of your unsecured debts. If you fail to meet the payments, the court may dismiss the case — and there will be important consequences for those unsecured debts.

The Effect of Not Listing Creditors on a Bankruptcy Filing

Although filing for bankruptcy offers financial relief, the process isn't stress-free. You'll have to chase down proof of myriad financial details to include in your petition, and this takes time and a bit of work. It's easy to overlook a creditor – even more than one – as you prepare to file. In some cases, fixing the mistake is relatively simple. In others, you may not be able to discharge the debt.

How to Reinstate a Dismissed Bankruptcy

At the conclusion of your bankruptcy case, you typically will receive a bankruptcy discharge. A bankruptcy discharge means that all of the debts that are included in your bankruptcy case are erased and your creditors cannot pursue collection action against you to enforce the debts, like filing a civil lawsuit. During the bankruptcy case, you can ask the court to dismiss your case, or the court may dismiss your case on its own, and you will not receive a bankruptcy discharge. However, you can ask the bankruptcy court to reinstate your bankruptcy if it is dismissed by the court.

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