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Do I Really Need to List all My Creditors in Bankruptcy?

YES!  The simple answer is: Yes.  Some clients will want to file bankruptcy on a select group of creditors (such as credit cards, lines of credit, etc.), yet want to keep a second group of creditors out of their bankruptcy (such as primary physicians, friends, and family).  This post details why it is absolutely necessary to list all creditors when filing for bankruptcy relief.

The primary reason to list all known creditors is to avoid perjury.  The bankruptcy petition is signed under penalty of perjury, which includes declaring that all creditors are listed.  If a consumer knowingly fails to list a creditor in his or her bankruptcy filing, this is tantamount to committing perjury. Additionally, a consumer should list all creditors, particularly if an unlisted creditor decides to try and collect on a debt later on.  If a consumer deliberately fails to list a creditor in the bankruptcy, the creditor could essentially survive the bankruptcy process intact.

What types of creditors, generally, are people hesitant about listing?  Family, friends, and family doctors are the top three categories.  I reassure my clients that they must list all creditors known to them, but they can voluntarily repay any creditor after the bankruptcy is completed.  Often, clients may opt to voluntarily repay a long-time family physician (or opt not to, per the bankruptcy).  This is true for family and friends, too.  Nothing stops a client from voluntarily repaying any one creditor he or she chooses.  But the crucial point is that all creditors, despite who they are, must be listed in a client’s bankruptcy schedules.  If a client deliberately fails to list a creditor, this amounts to perjury.

If you have questions regarding bankruptcy and how it may affect family, friends, or even doctors for which you may owe a debt to, please feel free to call today to schedule your free consultation in Eugene.