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What happens to debt owed to family or friends when you file for bankruptcy?

Annapolis, MD |

We are preparing to file a bankruptcy, and we own my mother-in-law $2,000 each on two credit cards. Do we mention this debt in our filing, or do we need too, or is this something that can be discharged? Thank you.

Attorney Answers 6


  1. Best answer

    You are signing you bankruptcy papers under the penalty of perjury can you need to list ALL of your debts. There is nothing wrong with paying your mother-in-law back down the road, Repaying her will not impact your case. However, I would not suggest making any more payments until after your file. Talk to your bankruptcy attorney about voidable preferences.

    First, the firm is a debt relief agency according to the U.S. Bankruptcy Code. We help people file for bankruptcy. We also do other stuff and we do it well, but Congress wants me to post this notice. Second, nothing on this site is legal advice. You are not my client unless you enter into a written agreement signed by you and me.


  2. You are required to list all your debts and assets. You should not repay on the eve of bk. There is no reason you could not repay later if you voluntarily chose to do so. You should retain an attorney and not attempt yourself.

    This is not to be considered legal advise and no attorney client has been established.


  3. The debtor is "required" by law to list all known creditors, this requirement includes listing family members.

    How you list them depends on the nature of debt (e.g secured, unsecured, etc).


  4. Every bankruptcy attorney understands that you don't want to list your family and friends on your bankruptcy petition and that you want to pay them back even though you don't have to. A lot of filing bankruptcy is being willing to follow the rules and suck it up to do what you have to do to obey the law. You are welcome to follow your heart once your bankruptcy is over. Family will always understand and secrets can be toxic. Hope this perspective helps!


  5. Bankruptcy is all about full disclosure. All your creditors, all your assets, all your income, if you leave anything out you will probably regret it.
    As others have stated, you can voluntarily repay everyone if you want to. Mark Twain had to file for bankruptcy protection when a business investment went sour. Then he went on to become a premier American author, with plenty of money to repay everyone, which he did! Good luck.

    I am not your attorney unless you and I have signed a retainer agreement. What I am saying is not legal advice. Do not act on this information without engaging my services, this is for consideration only.


  6. You can discharge that debt but you have to list her as a creditor to do so.

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