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Bankruptcy Law/Old bankruptcy disclosure required?

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Expert: - 4/4/2009


Question
My chapter 7 was discharged over 10 years ago, and has vanished from my credit reports. My credit score has fully recovered, and I am looking into refinancing my home. Am I required to disclose my bankruptcy if asked? Can I check "never filed" or do I have to check the only alternative which is "> 72 months"?

Answer
One of my own clients asked me the same question yesterday. I do get this question alot, because it challenges our natural human instincts.

If you are going to answer the question honestly, you already know the answer. The answer is "yes I did."

It's off your credit record because the law says that it can't be reported on a credit bureau for more than 10 years. However, there is still a record of it, and your file will be in the court records for 24 years before the paper file is destroyed. After that, it will still be on record in the court index.

If you were nominated for a high government post or a candidate for high office, I am sure that your political opponents would easily locate the information no matter how long ago it was.  

Are you required to answer truthfully? You could always ask them if it is OK to answer any of their questions falsely. I think we know what their answer will be.

If it was me, I would answer honestly, and include an explanation next to the box to tell them how very long ago it was. Hopefully that won't screw anything up. We are all human. Even President Oboma has honestly disclosed drug use in his youth. That didn't hurt him one bit. If he had lied about it, it might have been very damaging because then he would have been tagged as dishonest.

In the final analysis, it's up to you.

Whatever you do, I hope it turns out fine and you get the loan.

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Los Angeles Bankruptcy Lawyer Leon D. Bayer

Expertise

Leon Bayer has successfully represented clients in bankruptcy for over 30 years. He is frequently called upon by the media, the California Bar and other associations to provide insight and help educate attorneys on bankruptcy issues. If you or other readers want to keep up with my blog postings about life in and out of bankruptcy, you can follow my blog at http://www.bankruptcyblogger.org/ and my personal web site at http://www.debt-relief-bankruptcy.com and A Human Guide to Bankruptcy at http://www.thebankruptcyguide.net/ Leon also writes about bankruptcy law for Nolo, see http://www.nolo.com/law-authors/leon-bayer.html and his "Ask Leon" bankruptcy law blog column at http://blog.nolo.com/bankruptcy/

Experience

Leon is a Certified Specialist in Bankruptcy Law by the State Bar of California, and has been a practicing bankruptcy lawyer in Los Angeles, California for 33 years.

Organizations
National Association of Consumer Bankruptcy Lawyers, California Bar Association, Los Angeles County Bar Association.

Publications
Author, ?The Essentials Of Chapter 13,? Daily Journal Report, December 18, 1987.
Contributing Editor, Basic Bankruptcy, California Practice Handbook, Matthew Bender 1992, 1993.
CEB Consultant, CEB-Personal and Small Business Bankruptcy Practice in California, 2003.


Education/Credentials
B.A., J.D.

Awards and Honors
President, 1995-1996-Los Angeles Bankruptcy Forum; Member - Los Angeles County Bar Association Committee on Commercial Law & Bankruptcy, 1988. Law Advisory
Commission-Personal & Small Business Bankruptcy Law of the State Bar of California, 1996-2000

MR. BAYER SAYS: The big banks and credit card companys have been working overtime for many years to undermine the Consitutional right of the American people to be able to claim bankruptcy protection. In 2005 the banking lobby successfully convinced Congress and the President to make the laws and proceedures more complicated, hopeing that it will stymie legitimate people from filing bankruptcy. They succeeded in gaining these complex new legal proceedures by greasing the legislative system with hundreds of millions of dollars in "campaign contributions." The good news for the American people is that while the new laws have made the proceedures needlessly complex to the point where inexperienced people can't help but trip over the maze of new rules and regulations, the process is still doable, especially with a lawyer who is well trained and experienced in this specialty.

Past/Present Clients
I have probably handled something on the order of about 15,000 bankruptcy cases thropughout my career.

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