One of the worst feelings someone can have during the bankruptcy process is when they discover they forgot to include a creditor on their petition. It happens. Even though we pull credit reports for our clients, some creditors don’t show up on those reports. Creditors like medical providers and payday loan companies are common. Whenever one of my clients calls telling me that they forgot a creditor, they call worried that the debt won’t be eliminated with the rest of their debts. And rightly so. Section 523 states that debts that aren’t listed in the petition won’t be discharged.
The good news is that we can fix it. First, the Bankruptcy Code allows you to amend, or update, your bankruptcy petition. So, we can update it to include the forgotten creditor. However, the court does charge a small fee to file the amendment and there can be additional attorney’s fees to prepare the paperwork.
Also, if yours is a no-asset case, all of your dischargeable debts are eliminated, even if those creditors are forgotten. A no-asset case means that all of your property, including real estate, is protected under Colorado’s exemption rules. Since the property is protected, there are no assets to liquidate and distribute to your creditors.
What should you do if a creditor that you forgot contacts you about a debt that should have been included on your petition? First, let them know that you filed bankruptcy and give them your case number. In most cases, this should be enough to get them to drop the issue. If they persist, contact your lawyer with the details. Tell her that you want to amend your petition or ask whether you need to be concerned about the zombie creditor.
Naturally, the best course is to make sure that you include all of your creditors in the first place. While your credit report should have all of them, make sure you review your petition closely. Look for former rentals, medical providers, and payday loans that you know you owe money to. We can fix any omissions, but having these creditors on your petition in the first place will save you time and worry.
If you have questions about the bankruptcy process, we hope you’ll schedule a free, no-obligation consultation with an experienced bankruptcy attorney. You can schedule an appointment online or call 303.331.3403 to come in at a time that is convenient for you.