25 Mar Paying Back People You Owe Before and After Bankruptcy
For many reasons you should not pay people, relatives, and other Creditors back before filing a bankruptcy.
The greatest reason is that the Trustee has the ability to take the money back, so that one Creditor (includes relatives who lent you money and you paid back) is not preferred over another of similar status.
Generally, you can pay people back after a bankruptcy without consequence. However, you must speak with your attorney first to make sure you are not adversely affecting your bankruptcy.
Another problem with paying Creditors back after bankruptcy is that the Creditor may not want the money after writing the debt off or may not be able to track such payments. Additionally, these payments generally will not help your credit and may even hurt your credit if reported.
Bankruptcy Law Network (BLN)
Latest posts by Bankruptcy Law Network (BLN) (see all)
- Bankruptcy Rule 3002.1: An Unlikely New Weapon Against Debtors - January 9, 2017
- Court Says Chapter 7 Debtor May Not Have Two Cases Pending at Same Time - December 12, 2016
- What Happens to My Inheritance in Bankruptcy? - December 2, 2016
- Unsettled Question: Another Court Rules That Bankruptcy Client Worksheets Are Privileged - February 6, 2016
- Chapter 13 Debtor’s Lawsuit Tossed Out for Failure to List It in Bankruptcy Documents - January 31, 2016