Do Bankruptcies Get Denied?

If you are considering filing for bankruptcy in San Diego, you may be wondering whether there is a chance your bankruptcy could be denied. There are many circumstances under which a U.S Bankruptcy Court in the Southern District of California will deny your bankruptcy. We will discuss some of the most common reasons bankruptcies are denied below.

  • Attempt to Defraud

When a debtor seeking bankruptcy intends to delay, hinder, or defraud a creditor, the bankruptcy will be denied. Attempting to defraud a creditor can include transferring, destroying, mutilating, removing, or concealing property within one year before filing for bankruptcy or after filing for bankruptcy. Defrauding a creditor typically occurs when someone tries to give property away or destroy evidence of their assets, so they do not have to preserve them from being sold to pay their debts. 

  • Lying

When you file for bankruptcy, every statement you make must be truthful. If you make a false statement on your bankruptcy petition, the courts can discharge your bankruptcy. In addition to your bankruptcy getting denied, you could face criminal charges for making a false statement under the penalty of perjury. The bankruptcy trustee or a creditor has the right to challenge the discharge of your debt if they discover that you made false statements.

  • Concealing Information

If you falsify, mutilate, destroy, or hide information about your financial situation, the bankruptcy court can deny your bankruptcy. Sometimes applicants tried to destroy records that could lead the bankruptcy trustee to discover a property you have not disclosed on your bankruptcy application. In other cases, an applicant cannot backup options about their finances that they have made in their bankruptcy schedules.

  • Refusal to Comply With a Court Order

When a debtor refuses to obey an order given by the bankruptcy court, the court may discharge their case. If you are unsure how to comply with a court order, the best thing you can do is discuss your case with a bankruptcy lawyer. Simply ignoring the order can be devastating for your bankruptcy petition.

  • Failure to Take The Required Course

If you fail to complete the instructional courses required by federal law, you run the risk of your bankruptcy being denied. Bankruptcy petitioners must take a credit counseling course before they begin their bankruptcy case. After their case is completed, they must take a financial management course before the bankruptcy court will discharge their debt. Failure to take one or both of these mandatory courses will result in the bankruptcy court denying your bankruptcy.

Discuss Your Case with a San Diego Bankruptcy Lawyer

There are several different ways a bankruptcy court can deny your case. All of these grounds for denial can be avoided when you work with an experienced San Diego bankruptcy lawyer. Contact Bankruptcy Law Center today to schedule your initial consultation with one of our skilled bankruptcy lawyers.

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