Property: Do I Really Have To List Everything?

06 Aug Property: Do I Really Have To List Everything?

Posted at 13:45h in Bankruptcy Basics by Bankruptcy Law Network (BLN) 2 Comments

Bankruptcy is all about protecting you and your property from creditors. But do you really have to disclose ALL of your property in a Chapter 7 filing? Will anyone find out if you don’t?

Here is the short answer: YES.

In a typical Chapter 7 petition, a debtor will be asked no less than 10 times whether he is telling the truth. They even use the scary phrase under penalty of perjury.This is a reminder that hiding assets is not only a violation of federal bankruptcy law, but may be a crime punishable by jail.

It makes no difference if the property:

Was received as a gift . . . It is yours.
Was paid for by someone else. (mom puts your name on her bank account or house) . . . . . It still must be disclosed.
Has no “paper trail” . . . . . . It is still yours.

Something to remember. The US Trustee has substantial resources to uncover hidden assets. Every day their phone rings with ‘anonymous tipsters’ informing them of undeclared property.

Bankruptcy lawyers don’t like surprises. Full disclosure puts your lawyer in the best position to protect you and your property. When an attorney is told the whole story, he can better explore all the protection options available. This may also include filing a Chapter 13 bankruptcy.

Here are the more common difficult areas that require complete disclosure:

Any claims you have for money, including personal injury claims
Gifts you may have received
Property you may have transferred out of your name recently
Possible inheritance interests after someone has died
Bank accounts/ real estate owned by parents with your name on it

Bankruptcy is an important protection. And the clear majority of those who file are honest, hard working people who have run out of options. And having a debtor list all of his property in a bankruptcy petition makes the process fair for everyone.

Bottom line: your information must be complete, accurate and truthful. So, if you need to file for bankruptcy, be prepared to disclose all property to your lawyer. This includes any interest in real estate or personal property.