Let’s talk about two kinds of debts that you can repay after your Chapter 7 case has been concluded.

First, there are secured debts like car loans and mortgages. Many clients typically say when we sit down to review their Chapter 7 petition and paperwork: “But, I don’t want to include my car loan and mortgage in the bankruptcy.” Well, they are only half-correct in saying this. We are required by law to list all debts when filing bankruptcy. You cannot hide any of your debts from the Court when you file your papers. So, with your car loan and mortgage, there is a separate document known as the Statement of Intentions in which you must declare what you intend to do with your car and house. In other words, are you going to sign a “Reaffirmation Agreement” with your car lender or mortgage company? Are you going to surrender the property and get rid of the loan? Or are you simply going to continue making monthly payments?

I have many clients who ask if their car lender or mortgage company is going to object if they file bankruptcy. No, absolutely not, because if you’re going to continue making monthly payments, then they don’t really care what you do! More on this in a separate future post concerning reaffirmation agreements though!

The second type of debt that you may want to repay after bankruptcy would be an unsecured debt. Note however that I am not talking about a credit card debt. You can still get a new credit card to use for emergency purposes after the conclusion of your bankruptcy case. Instead, I am talking about a bill that you might owe your dentist or doctor. The law says that you have to list all of your debts in the bankruptcy case, so indeed if you owe your dentist, it’s going to be listed. Let’s say that you have been pleased with the care that your dentist has provided and you want to keep him as your dentist in the future. Simply contact him after the case has been filed and explain that you’ve had financial problems and been forced to resort to bankruptcy and you’re going to do all that you can to repay him in the future. The debt will legally be discharged, or wiped out, but you can still repay those discharged debts if you have a desire to do so. The dentist might even be pleased however about your candor and your resolve to pay what you can.

Let me know if you have any comments or questions!