What To Do When A Creditor Is Left Out Of The Bankruptcy Petition.
It is extremely important to list all of your creditors in bankruptcy. Only the debts listed will be discharged. This is why we run a credit report and ask our clients to give us a list of every creditor. Usually we find all of the creditors this way, but sometimes a forgotten (or unknown) creditor that does not appear on the credit report will be inadvertently left off of the schedules, meaning their debt is not subject to discharge, and the Client can still be held liable for that debt regardless of the bankruptcy UNLESS action is taken.
The most common occurrence of this involves debts associated with hospital visits. When you receive services through a hospital, you will generally receive invoices from not only the hospital, but also the doctor who treated you. So, if you only list the hospital, the debt to the physician who bills you separately from his office is not going to be covered. It is very important to list both. If your trip to the hospital was so close to your filing date that you have not yet received bills, you must make a phone call to the hospital to find out who you should expect to receive bills from.
This also happens when a Debtor has no recollection of a creditor’s details and the debt does not appear on the credit report. In these situations I encourage the Debtor to try their hardest to remember as much as possible. Even if we do not know an account number or the amount owed, as long as we get the creditor’s name and address, we can include it in the bankruptcy.
If a creditor has been left off of the schedules and you realize it while your case is active, we are required to file amended schedules and identify the creditors. There is a small fee to the Court for filing amended schedules, but it is necessary to complete your bankruptcy petition. If you do not realize it until after your case has been closed out, we may have to petition the court to re-open the case in order to amend the schedules and discharge that debt. There is a more substantial fee for that, but again, it is usually necessary.
Obviously, debtors are expected to be open and honest in describing assets and debts, so if a debt was unintentionally left off of the Petition, you must bring that to your attorney’s attention RIGHT AWAY. It can be fixed. An intentional failure to list a creditor, on the other hand, can cause that debt to be declared non-discharged and survive the bankruptcy. In extreme cases courts have denied a bankruptcy discharge because of the debtor’s intentional failure to list all debts.
My Credit Card Company Is Offering A Credit Monitoring Service: Is This Service Worth It?
Several companies have sprung up that promise to help protect you against identity theft. How do they do this? By monitoring your credit. An alert is sent to you when changes to your credit occur such as when a new account is opened or a new address associated with you is logged with a credit reporting company. Some credit monitoring services are independent companies and some are operated by credit reporting agencies such as Trans Union and Experian.
While there are advantages to using these services, there are some problems with them such as:
1) If you receive a Notification from a monitoring company, your information may have already been used illegally by someone who has opened up a new credit account with your stolen identity.
2) The monitoring services cannot catch certain forms of identity theft that don’t access your credit report such as a person using a stolen identity to a) obtain a Payday advance loan, b) apply for a job; or c) apply for a driver’s license.
3) Most of what these services offer, you can do yourself. You can file fraud reports and place fraud alerts and credit freezes on your credit files with credit reporting companies.
Many people believe that credit monitoring activities will make them completely secure against identity theft. That simply isn’t true. However, credit monitoring can be an important piece of your protection package. Some other things you can do include:
- Leave important documents in a safe place at home.
- Only carry the credit cards or other cards you plan on using that day (do not carry your Social Security Card).
- Properly destroy old credit cards, checks and unneeded receipts
- Shop only on secure Web site with companies you trust.
- Check your bank and credit card statements monthly for any suspicious activity.
- Personally check your credit report at least once a year.
Since the cost of a monitoring service usually runs $10 to $15 a month, it may be worth it for the peace of mind in knowing that you are purchasing a little added insurance to avoid being the next victim of identity theft.