If you forgot to list a creditor during bankruptcy in NY, you may not know what your next steps should be. With so much information being required to file for bankruptcy, it isn’t uncommon for certain details to slip through the cracks.
At Grady BK, PLLC, we strive to provide each and every one of our clients with the one-on-one legal attention that they need. We provide straightforward and honest guidance so that you can proceed with your bankruptcy case with complete confidence and peace of mind. In this article, we will discuss what to do if you forgot to list a creditor during bankruptcy in NY and the possible repercussions of not listing all of your creditors.
What Happens in Chapter 7 If a Creditor Is Omitted?
Accurately listing your creditors is an essential part of filing for Chapter 7 bankruptcy in New York. By doing this, you are listing the debts you owe in the hopes of having them discharged (wiped away). Your creditors have to be notified that you filed bankruptcy in order to get discharged.
If you file for bankruptcy in New York with omitted debt, this could mean that the creditor could try to collect the debt from you. However, for Chapter 7 no-asset cases, there is still a chance that the omitted debt may be discharged depending on what the court decides. This is because there are no assets to distribute to creditors, so it doesn’t matter as much if a creditor isn’t listed and notified. If it is an unsecured creditor who was unintentionally omitted it is very possible that it can still be included in the bankruptcy and discharge (wiped away).
No matter what your situation is, you never want to file for Chapter 7 with an unlisted creditor if at all possible. If this happens, the court may suspect that this was done for the purpose of fraud, which could result in potential penalties, criminal fraud charges, or having your case dismissed.
What Happens in Chapter 13 With an Unlisted Creditor?
If you are filing for Chapter 13 bankruptcy and have forgotten to list a creditor, the results are often different. Like Chapter 7, when you forget to list a creditor in Chapter 13 bankruptcy, this means that the debt isn’t listed and the creditor isn’t notified. There is a small window of time where you can still include an omitted creditor in a chapter 13 by amending your schedules. However, once your chapter 13 case is confirmed (approved by the court) you can no longer add creditors.
At that point, an unlisted creditor is not included in the bankruptcy and can pursue collection actions against you and could even object to your Chapter 13 repayment plan.
Again, like Chapter 7 bankruptcy, there is also a chance that fraud could be suspected if you file for Chapter 13 bankruptcy with an unlisted creditor. Depending on the circumstances, this could result in your case being denied, penalties, or charges.
If you have noticed that you forgot to list a creditor when filing for bankruptcy, it is essential that you seek out representation from an experienced bankruptcy attorney.
Forgetting to List a Creditor During Bankruptcy: Can You Fix Documentation After Filing?
Even though forgetting to list a creditor during bankruptcy is serious, it is a reversible mistake. You can take steps to add a creditor after filing for bankruptcy as a way of amending your case to accurately reflect your debt.
The number one thing you need to do immediately if you realize you have left out a creditor is to speak with a bankruptcy lawyer. A lawyer will understand the complexities of New York bankruptcy and can help you decide what steps to take next.
If your debt has not yet been discharged in a Chapter 7, your attorney can help you amend your filing to accurately reflect all of your creditors. If you have filed for Chapter 13 and your case is not yet confirmed (approved by the Court), you can request to amend the bankruptcy schedules to add a new creditor.
As long as you act quickly and notice the issue early on before debts are discharged, amending your filing will be a relatively straightforward process. There usually won’t be any repercussions, aside from the possibility of a small amendment fee.
When a Creditor Challenges Dischargeability
Creditors have certain rights when it comes to bankruptcy, especially if they weren’t listed when you filed for bankruptcy. When this is the case, the creditor has the right to challenge dischargeability (they sue you when you are the bankruptcy) if they believe it to be unfair. Creditors can do this by filing a complaint for things like:
- Fraudulent behavior or misrepresentation
- Non-dischargeable debts
- Reckless spending
- Intentional misconduct
- Fraudulent debts
- Luxury goods or cash advances
When a creditor files a complaint, you will usually need to provide evidence to refute the creditor’s claims, as well as attend a court hearing with the creditor. After hearing both sides, the judge will come to a decision. The judge could decide to dismiss the creditors’ claims entirely or may require you to pay back certain debts that are not considered to be dischargeable.
FAQ
Can I add a creditor after filing for bankruptcy?
Yes, in the majority of bankruptcy cases you can add a forgotten creditor to a Chapter 7 bankruptcy before the case is discharged or before a Chapter 13 bankruptcy filing is confirmed.
Will I still owe the debt if I forget to list it?
Owing debt that is not listed in your bankruptcy filing is a very possible repercussion. This will depend on the type of bankruptcy you are filing for and whether or not it was an asset or no-asset case.
New York’s Top Compassionate Bankruptcy Attorney
Amending bankruptcy schedules in NY can be complex, which is why you shouldn’t attempt to do this on your own. At Grady BK, PLLC, we can help you address issues with your bankruptcy filing, whether you accidentally provided inaccurate information or forgot to list a creditor. We can help you every step of the way, ensuring you know exactly what to expect and what protections you are given during bankruptcy.
At Grady BK, PLLC, we understand how overwhelming this process can feel, especially if you don’t have any experience with bankruptcy. That is why we are here to answer any questions or concerns so that you have complete clarity about the process.
Contact us today at 315-299-9005 to discuss your situation with a bankruptcy attorney in New York. Our team at Grady BK, PLLC, is here to help you not only choose the right type of bankruptcy but also navigate any possible issues along the way.
