You should list all medical bills even if you believe them to be covered by insurance, because the insurance company may later deny the claim. You should list cosigned or guaranteed debts of others even if payments are current because a future default means the debt comes back on to you.
This is due to a First Circuit ruling that an unlisted possible indemnification obligation (a type of guarantee of another’s debt) was not discharged. The debtor didn’t list the contingent debt in his no-asset case because nothing was owed at the time of the bankruptcy filing – it arose one year later when the other party defaulted on future construction performance. Too bad for the debtor.
Many people filing bankruptcy worry about not listing a long-forgotten creditor in their bankruptcy case. They fear that if the debt isn’t listed in their case, the creditor will have the right to pursue them for payment. This is not necessarily true.
The fact is that these circumstances don’t exist in the vast majority of Chapter 7 cases. In a Chapter 13 case, the discharge is granted only for debts provided for in the Chapter 13 plan. Therefore, it is important that all creditors are listed in a Chapter 13 case.
Occasionally a creditor will attempt to collect a debt after a bankruptcy case is over, and assert that because the person filing bankruptcy failed to list them, they get to collect the debt. If this happens to you, you should contact your attorney right away so that he or she can send the creditor a letter explaining what your rights are, and demand that they immediately stop collecting the debt from you.
Clearly, the best thing is to avoid the stress of dealing with an unlisted creditor after a bankruptcy. Getting a credit report before you file bankruptcy can be very helpful in ensuring that you list all your creditors. It is important to note that your credit report may not contain all the creditors who have claims against you. Many times medical providers don’t report to credit reporting agencies, and it is also possible that certain debts can be missing from your report temporarily.
Carolyn Secor is a Clearwater bankruptcy attorney and Clearwater foreclosure attorney serving Palm Harbor, New Port Richey, Oldsmar, Tarpon Springs, Seminole, St. Petersburg, and the Tampa Bay area.