Sued for Debts Omitted in Bankruptcy
When you file bankruptcy, you are obligated to disclose all of your assets and debts. This is clearly stated in several of the documents that you sign for your claim.
Failure to reveal all of your financial information can lead to a dismissal of your case. In addition, you could even be fined up to $500,000.00 or imprisoned up to 5 years for deliberately making false statements or concealing property from the bankruptcy court.
It is in the best interest of the individual filing bankruptcy to include all debts in his or her case.
Steps to Take If a Creditor Sues
When a bankruptcy petition is filed with the court, an automatic stay halts all collection attempts by creditors named in the filing. But if a creditor is erroneously left of the petition, they are free to continue collections.
If a creditor decides to sue for an unsecured debt, you will need to amend your bankruptcy schedules. If your bankruptcy case has already been closed, you'll have to file a petition to reopen your claim. In either case, you must file an amendment to your bankruptcy schedules in order to add the particular creditor.
The court will then give notice to the creditor involved, and allow a certain amount of time for them to object to the discharge of this debt.
Be aware that amending or reopening your case will likely involve some court fees, depending on the type of creditor involved.
Connect with a Lawyer Near You Today
Filing a bankruptcy claim can be complex, particularly if it involves reopening a case. A lawsuit from an omitted creditor may only complicate your case even further.
But you don't need to find your way through this difficult process on your own. An attorney can help you navigate the court and halt your creditor.
Just fill out the form below today to connect with a local attorney for a free case evaluation.