When you are buried under debt with no way out, bankruptcy is often the best option. And while there are different types of bankruptcies that one can file for, many people choose Chapter 7 bankruptcy, as you could be eligible to have most of your debts discharged. But in order to have your debts discharged, you must make full disclosure of all of your assets. This includes those assets that are exempt and nonexempt from being discharged. But what happens when you fail to disclose some of your assets?
Whether you try to hide some of your assets or you genuinely forget to include some, here’s what could happen to you in Texas.
1. Your Debts Will Remain Intact
If the court finds that you are hiding assets while your case is filed with the bankruptcy court, you could lose your eligibility for discharging your debt. Additionally, you will also have to pay your creditors with your non-exempt assets and remain on the hook for any debt that is left over.
2. The Court May Revoke Your Debt Discharge
If you hide some of your assets and it isn’t’ discovered until after your case is over, it doesn’t mean that you can’t still incur penalties. In fact, if your debt is discharged before your assets are located, the trustee still has up to one year after the close of your case to revoke its decision.
3. You’ll Be Prevented from Claiming Any of these Debts in Future Bankruptcy
Whether your bankruptcy is denied or your discharge is revoked, you will no longer be allowed to list the debts on that application on any other bankruptcy filing going forward. However, it’s important to note that this does not prevent you from filing for bankruptcy based on new debts in the future.
4. You Can Be Charged with a Crime
It may not seem like that big of a deal, but when you sign your bankruptcy application you do so under penalty of perjury. This means that you will be punished if you provide false information on your forms. Texas generally treats perjury as a Class A misdemeanor – the highest level charge before it becomes a felony. If you are found to have committed perjury on your paperwork, you can be sentenced to a fine of up to $4,000 and/or a jail sentence of up to one year. The severity of your punishment depends upon the severity of the specific facts and circumstances of your case.
Toronjo & Prosser Law Helps Those Who Are Dealing with Bankruptcy
It’s undoubtedly stressful to realize that you don’t have enough money, and even more stressful when you realize that filing for bankruptcy may be your best option. That’s why it’s so important to consult with a knowledgeable and experienced Dallas bankruptcy attorney. At Toronjo & Prosser, our qualified Texas Bankruptcy Attorneys can help you to navigate the process. To learn more or to schedule a free consultation contact us online or call us today!