While most closed bankruptcy cases remain that way, there are some situations when a case can be reopened. Let’s take a look at why your closed bankruptcy case may be reopened:
To Add a Creditor
If you forgot to include a creditor in your bankruptcy case and it’s already been discharged and closed, you can have it reopened to add the creditor. In the case of Chapter 7 bankruptcy, this shouldn’t have any impact on the ability to discharge your debts as long as the creditor is unsecured and they don’t have any objections to your case. However, your bankruptcy case will likely remain open for months to give the creditor the opportunity to raise any concerns or objections.
To Disclose an Asset
Since bankruptcy can be a bit overwhelming, some debtors forget to list all of their assets. In that case, you can reopen your case and disclose the asset. This shouldn’t impact your Chapter 7 or Chapter 13 bankruptcy case too much as long as the asset is fully exempt. However, if your asset is not exempt, or if it is only partially exempt, this may complicate things. Reopening your bankruptcy case to include a non-exempt asset could mean that the asset will need to be liquidated and the proceeds used to repay creditors. Once again, this can take time, leaving your case open for months.
To File Your Credit Counseling Certificate
If you fail to file your creditor counseling certificate, the bankruptcy court may close your case without giving you a discharge. However, you can reopen the case, file your certificate, and get your bankruptcy discharge as long as everything else is in order.
If it is discovered that you willfully defrauded the bankruptcy court, your case could be reopened and your discharge could be revoked. Bankruptcy fraud usually includes hiding or transferring assets.
If you need to reopen your case to include updated information, contact your attorney immediately.