One of the benefits of using Chapter 7 to file for bankruptcy is that you can discharge all of your unsecured debts once you have everything approved. However, forgetting to list every single unsecured debt on the bankruptcy filing paperwork can cause some big problems. If you do not list the debt, it won't be discharged. Keep these things in mind when compiling your debts.
The Debts To List
Your bankruptcy lawyer will help walk you through the process of listing debts, but it starts with you listing as many as you can. This list should not be limited to companies, but also includes individuals that you owe money to. You'll need to list as much contact information as possible. If it's a business, list the company account number that the debt is tied to. If it's an individual, list their name, address, and phone number.
You need the contact information because each creditor will be contacted when you file for bankruptcy. They then have the option to fight your bankruptcy and explain why their debt should be excluded from it.
The Debts To Not List
Your lawyer will also get a copy of your credit history and look for debts that are listed on there as well. Do not assume that you can list every debt listed here, as there are some you can't include.
Any existing auto loan should be kept off your debt list if you want to keep your vehicle. The same goes goes mortgages if you are going to keep your house. Alimony, spousal support, and child support are debts that you must maintain with Chapter 7 bankruptcy, as well as payments ordered by the court. You'll also be stuck with student loans and back taxes that you still owe.
Debts Often Forgotten About
Chapter 7 bankruptcy gives you the chance to legally clear you of debts that may have been forgotten about.
If you got into a fender bender where the other driver never made a claim, you could officially list the incident in your bankruptcy to be absolved of any damages owed. Sometimes people have a last month of rent that was never paid to a landlord, which can also be included. You'll want to do a deep dive into your financial history and list any debt that can qualify to be discharged in your bankruptcy filing.
For more advice on what debts to get rid of, be sure to work closely with your lawyer.