I met with a client on Saturday. She filed bankruptcy eight years before with a lawyer who does not have an office in Bakersfield but who had an internet based “state-wide” practice.
While we went over the petition, she told me that when she bought her house several years ago, she was told that in order to qualify for a mortgage, she had to pay a creditor that appeared on her credit report.
Since the creditor was listed in the bankruptcy, she called the creditor and asked why they expected to be paid post-bankruptcy. The creditor’s representative said while they were listed in the bankruptcy, she still owed them because she did not list a large enough amount in the bankruptcy.
The creditor lied to my client. If it had happened recently, I would have sued the creditor. Unless the creditor files a formal objection to discharge, which is very rare, the debts are discharged. She was caught between a rock and a hard place and she felt forced to pay the money to be able to get the house.
Why do I tell this story? There are a few lessons for debtors who want to get the full value of their bankruptcy:
1. Two or three months after you get your discharge, get a credit report. All debts should be at zero. If there is a problem, the time to fix it is before closing on a house or trying to buy a new car.
2. A bankruptcy case, even if done correctly, sometimes requires follow up work because of the actions of creditors. If I file your bankruptcy, and something comes up, set an appointment. If your bankruptcy lawyer is no longer in town, or it back to doing divorces, call and make an appointment.
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