Posted by David Leibowitz on June 3rd, 2009 in Bankruptcy Crimes, Bankruptcy Legislation, Business Bankruptcy, Discharge, dischargeability of debt, financial statements
Banks may care about what you say on the financial statement in your loan application. When you apply for a loan, the bank asked you about your assets and liabilities. If you told the bank you have less than you actually own, this may not be a problem. Some financial statements create problems. Here are some common problems in financial statements:
- You claim to be the owner of something you really don’t own
- You claim to own something outright when you really own it with your spouse
- You claim to own something in joint tenancy when you really own it as tenants in common
- You overstate the value of your personal property
- You overstate how much you have been earning.
If the bank or another lender justifiably relies on something you put in a financial statement, you could be in trouble if you knew your statements were material and not true when you made them. A bank might seek to bar dischargeability of your debt even if you do file a bankruptcy case. Sometimes a bank might try to bar your discharge altogether. A bank may threaten to prosecute you for bank fraud.
Banks today are under severe stresss. If you plan to file a bankruptcy case, you should consider how a bank might react to your filing. Tell your bankruptcy lawyer everything you told your bank when you took out your loan. It will help your lawyer advise you and help you to be ready for any claim a bank or other creditor might make against you during the course of your bankruptcy case.
For more information, check Bankruptcy Code section 523(a).
Lakelaw defends people against complaints under Bankrutpcy Code section 523(a) to determine dischargeability of debt and against complaints under Bankruptcy Code section 727 to bar discharge.
For more information about discharge in bankruptcy, click here
Call Lakelaw now at 1 866 LAKELAW (1 866 525-5359).