Legal Question in Credit and Debt Law in New York

Yes you can file for bankruptcy. Call an experienced bankruptcy attorney to discuss if bankruptcy is your best option.

Also licensed in NY, but not a bankruptcy attorney.

The general answer to your question is that admitting to a debt will not affect your ability to file for bankruptcy or to discharge that particular debt. For most types of debts, such as credit cards, loans, etc., the issue of liability for a debt is not important. The concept behind bankruptcy is to obtain relief from your debts. The fact that one actually owes money, and is unable to repay it, is the reason why people file for bankruptcy.

There are, however, at least two instances where it could matter. First, if you admit liability for a debt that might be non-dischargeable, such as for certain types of fraud, this may cause a problem for you in a bankruptcy case. Second, in a Chapter 13 proceeding, where you are paying back 100% of your debts (how much you repay is based on your income and/or your non-exempt assets), then you want to minimize the claims that must be paid through the repayment plan. Admitting to a debt may affect your ability to object to that creditor�s claim.

Keep in mind that how you actually admit to a debt is important. If done in the context of a court proceeding, such as in a written answer, or at a deposition, then you are generally bound by your admission. Admissions outside of court proceedings require proof and, practically speaking, rarely present an issue in a routine bankruptcy case.

Please contact my office directly if you would like to discuss your situation further. You may also visit my website at amdlaw.com for more information.