Bankruptcy petition can be changed to add debts
Reopening a bankruptcy case after it has been filed isn't as common as it once was, but there are options that allow debtors to add a creditor if they believe the move is necessary.
It's not unusual for debts to be mistakenly left out of the initial petition filed in U.S. Bankruptcy Court. In a Chapter 7 case, the most common form of personal bankruptcy, a creditor may be added to the filing if the deadline for filing claims hasn't passed. If it has passed and the money from liquidated property hasn't yet been distributed to creditors, a dischargeable debt may still be added.
Otherwise, when no distribution has been made to creditors, the Clagett Law Office in West Virginia points out that a particular debt that wasn't deemed dischargeable may be nonetheless discharged along with other debts although it wasn't listed.
However, most requests to reopen a bankruptcy occur because debtors want to file a contempt charge against a bill collector who is pursuing a debt that was discharged by the court. During the case, the court grants an automatic stay to prevent collection efforts and lawsuits. Once debts are discharged, creditors are prohibited from collecting the money that is owed to them.
One method of paying debt that was listed in the original petition is to reaffirm it. While not technically considered a reopening of the case, the move effectively changes the status of a particular debt and allows the debtor to voluntarily agree to pay it. Frequently, such moves occur so the individual can keep making car payments and retain a vehicle.
In its Reaffirmation Project, the Georgia Northern Bankruptcy Court warns that reaffirmation isn't a step to take lightly because the process makes the individual legally responsible for paying the bill. If someone has second thoughts about reaffirming a debt, the agreement can be rescinded within 60 days or before the bankruptcy is discharged, whichever is later.
Another scenario in which people may want to pay a debt that's included in the bankruptcy generally involved a co-signer. If the debt goes forward in the case, it may be discharged against the debtor, but not for anyone else who has co-signed the account. To remove full responsibility for the remaining bill from the co-signer, the party involved in the bankruptcy may reaffirm the amount and continue to make payments on it.
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