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Can My Bankruptcy Discharge Be Revoked?

If you’re eliminating debt through bankruptcy, understand the guidelines and when court can make the decision to revoke your bankruptcy discharge.

When you file for bankruptcy, you can also apply for a bankruptcy discharge, which releases you from liability for certain debts.

A discharge offers debtors a huge relief because it leaves intact the debt you can pay but removes the bills you can’t. It also protects you from interest and judgments by your creditors.

All discharges need approval from a bankruptcy court. What many people don’t realize, however, is that the court can also revoke your bankruptcy discharge.

When and how does this happen? Keep reading to learn more.

Can a Bankruptcy Discharge Be Revoked?

Although a bankruptcy discharge is a permanent solution to your debt, it is only permanent in the sense that your creditor can’t simply send you a bill later.

It is not guaranteed to be permanent because you can lose access to the discharge. Three parties are allowed to request a dismissal of your discharge. They include:

  • Creditors
  • Bankruptcy trustee
  • A representative of the U.S. Department of Justice

Thankfully, only a court can grant a bankruptcy discharge and only a court can take it away. A creditor or the trustee needs to make a case to the court with evidence in order to submit their request.

More importantly, it almost always needs to occur before the case is closed or within a year after the judge grants your discharge. 

In other words, a court won’t revoke your discharge five years after your bankruptcy case closes – without extremely exceptional circumstances

When Does a Court Revoke a Bankruptcy Discharge?

The most common cause for a bankruptcy discharge revocation is in the case of fraud. If your bankruptcy trustee finds that you obtained the discharge fraudulently, then they may request a revocation from the court.

Other reasons a creditor or trustee may request that your discharge be revoked include:

  • If they find out that you hid your property or assets
  • If you ignore a court order
  • If your assets disappear and no one can see where they went
  • If you don’t provide the required documents to your trustee
  • If you don’t provide the correct or complete financial information to the trustee

In other words, you need to complete your bankruptcy procedure by the book, or you risk it crashing down around you.

What Happens When a Court Revokes a Bankruptcy Discharge?

If a court revokes your bankruptcy discharge, then you won’t have a successful bankruptcy case.

A revoked discharge means:

  • You now owe all the declared debts
  • Your creditors can re-start charging interest
  • Your creditors can force you to pay through judgments
  • You can’t file bankruptcy again for up to 8 years

In other words, a revoked discharge is the worst-case scenario.

Seek Legal Help to Complete Your Bankruptcy Discharge by the Book

It’s critical that you file for bankruptcy by following all the rules and providing as much financial information as you can. If you fail to declare an asset or act improperly, the court could revoke your bankruptcy discharge.

If this happens, you not only owe all the debt you started with, but you can’t file bankruptcy again for up to eight years.

Seeking legal help ensures you have the best chance of a successful bankruptcy case. Are you thinking about filing for bankruptcy, but you’re not sure where to start or how to pay for it? Read the MacFarlin law firm’s guide to finding bankruptcy legal aid or get in touch at 949-544-2640.