Legal Question in Bankruptcy in California

Re: bankruptcy

You did not say if you are in a Chapter 7 or Chapter 13 bankruptcy. Aside from being angry, there is probably not a lot the lender can do. Unless the person who loaned you the money can prove that there is a legal reason why the obligation should not be discharged, then the money owed to him will be discharged completely (in Chapter 7) or partially discharged (Chapter 13, or in a Chapter 7 asset case). Given that the loan is undocumented, it falls pretty close to the bottom of the list in terms of debt priorities. Additionally, the Trustee may seek to go back and recover payments to this creditor as a fraudulent preferential transfer, as the lack of documentation for the loan would on its face appear to be fraudulent. From your perspective, you need to focus only on working your way through your bankruptcy, and if the lender files a complaint to avoid discharge, then at that point you'll need to evaluate with your attorney what needs to be done to avoid the debt.

*Due to the limitations of the LawGuru Forums, The Gibbs Law Firm, APC's (the "Firm") participation in responding to questions posted herein does not constitute legal advice, nor legal representation of the person or entity posting a question. No Attorney/Client relationship is or shall be construed to be created hereby. The information provided is general and requires that the poster obtain specific legal advice from an attorney. The poster shall not rely upon the information provided herein as legal advice nor as the basis for making any decisions of legal consequence.

Re: bankruptcy

Nothing legally, as long as you listed the person as a creditor in the bankruptcy.