I forgot to list a credit card debt in my bankruptcy. Do I still owe the bill?

If you forget to list a credit card debt on your bankruptcy schedules, it might not be discharged. Learn more.

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Question

I forgot to list a credit card debt in my schedules before I received my discharge. Do I still owe this bill?

(To learn more about bankruptcy and credit card debt, see our Credit Card Debt in Bankruptcy topic area.)

Answer

If you forget to list a creditor in your bankruptcy papers before receiving a bankruptcy discharge, the general rule is that the omitted debt is not discharged. That is because bankruptcy law requires you to list all of your creditors in your debt schedules. However, there are exceptions to this rule, and you may still have time to fix this problem if the rule does apply to you.

Creditor Notice

If the creditor received notice or had actual knowledge of your bankruptcy despite being unlisted, then the debt is still discharged. The creditor must have known or received notice of your bankruptcy before a discharge was granted. If the creditor claims it did not receive notice or had no knowledge of your bankruptcy, then it is up to you to prove the creditor wrong. This is hard to do, absent written proof such as a letter.

The Fix: Amend Your Bankruptcy Petition and Schedules

You may be able to amend your bankruptcy papers to include the debt.

Amending your papers is very important if you had assets in your bankruptcy so that unsecured creditors could have received or did receive payment (this includes most Chapter 13 cases). If you don’t amend, the debt will most likely not be discharged. The reasoning behind this rule: The unlisted creditor was prevented from filing a proof of claim and did not receive payments that it otherwise would have received. (The rule may be different if yours is a no-asset case. See below.)

If your case is still open. If your case is still open, you should amend your bankruptcy schedules to include the unlisted creditor. If you file for Chapter 13 bankruptcy and are still in the repayment period, you should amend your papers as soon as possible to allow that creditor to participate in the plan.

If your case is closed. If your case is already closed, then you will probably need to file a motion to reopen your bankruptcy case. If the court grants your motion and the case is reopened, you can then file the paperwork to add that creditor.

Debt May Be Discharged in “No-Asset” Bankruptcy Cases

In most states, you may not need to reopen the case if it was a “no-asset” bankruptcy (meaning, you did not have assets that the trustee could seize and sell to pay creditors). In no-asset cases, the omitted debt is effectively discharged anyway. The reasoning behind this rule:  Since you didn’t have any assets, the creditor wouldn’t have gotten any money even if you did list it. This is commonly referred to as the “no harm, no foul” rule.

However, if you intentionally omitted the creditor or acted fraudulently in excluding that creditor, then the debt might not be discharged even if it was a no-asset case.

There are some bankruptcy courts that may not automatically follow the “no harm, no foul” rule and still require you to file a formal motion to reopen, as well as possibly meet other requirements. These courts include:

  • Courts in the First Circuit courts (Maine, Massachussetts, New Hampshire, Puerto Rico, and Rhode Island), and
  • Courts in the Seventh Circuit (Maryland, North Carolina, South Carolina, Virginia and West Virginia).

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