Chap 7, 18 years ago, discharge of personal loan?

[firsttime]

My father filed a No Asset/Chap 7 15 years ago (1998). He had a personal loan with my sister, who had lent him $10,000 in 1989, with 10% interest per year. He didn't list this loan in his Chap 7. I wanted to confirm that although he didn't list the loan, that all loans and debts (except government) were discharged when his Chap 7 was discharged and closed. She is trying to go after the loan 24 years later and I want to prove that she doesn't have a leg to stand on. Sadly, he passed away in July, and it's all just interesting timing.

[AngelinaCatHub]

You are correct. The loan is not only non-collectable, whatever his estate is worth does not have to pay it anyway. What is she wanting to go after a dead man? Depending on the State even his estate would not be liable for this debt even if it were not discharged.

She has no right to anything at this time. It was discharged in the BK even though not listed. Most likely the Statute of Limitations would also be invoked in some form after this amount of time. Hope I've answered your question. It is brought up quite a lot regarding forgotten creditors. 'Hub

[keepmine]

Here's a good explanation about omited creditors in a no asset Chapter 7. The debt is considered discharged.

http://www.justice.gov/ust/eo/public_affairs/articles/docs/abi012001.htm

I'd also imagine the applicable SOL ran long ago as well. Might run this by a lawyer about how to proceed should she file a claim agaginst the estate.

[firsttime]

If the loan was reaffirmed later, would that have to be done via paperwork signed by both parties? And if he voluntariliy wanted to pay back the loan, but didn't pay the interest, is he bound by the original loan agreement, or is that long gone because of the discharge?

[tobee43]

as hub and keepmine point out, and, while i have read that information before that keepmine so graciously refers us to review, i actually agree with almost every word, unfortunately the the persistent creditor can be a thorn in the side by screaming about their creditors right of notification. while it is most likely they would never gain anything, some may still go or attempt to go through the motions.

i think in the case of the OP as it's been pointe out, the SOL is really more the point here than anything else dealing with any specific bk law. maybe it could vary from state to state? (if one filed state vs federal if that choice was given at the time of filing).

firsttime, i'm so sorry to hear about the lose of your father my heart goes out to you. i'm also so sorry what one experiences when someone thinks money is more important that a family relationship.

[keepmine]

If the loan was reaffirmed later, would that have to be done via paperwork signed by both parties? And if he voluntariliy wanted to pay back the loan, but didn't pay the interest, is he bound by the original loan agreement, or is that long gone because of the discharge?

What do you mean reaffirmed later? A reaffirmation agreement must be signed and properly filed with the bk court prior to discharge. The bk code specifically allows you to mke voluntary repayments to anyone you please post bk but, that does not obligate you to continue to pay if there is no reaffirmation agreement.

[kilowatt]

If your father has not made any payments on the loan for years check the statute of limitations for debts in the state he lives in. If it is past the SOL date then the loan is no longer valid or enforceable.

bankrate.com/finance/credit-cards/state-statutes-of-limitations-for-old-debts-1.aspx

[firsttime]

My father gave her two checks, in total $10K in 2012 and 2013. My sister is now saying she wants to put in a claim to the estate to collect interest on the loan from 1989. So, I guess he restarted the clock as far as statues go, but the loan should have been discharged in his BK, right? But as far as SOL's go, to go 24 years before he gave her a payment just seems too long.

[firsttime]

Thank you for your kind thoughts. You TOTALLY hit the nail on the head when you said that she chose money over family....I will have no relationship with her.

[keepmine]

I'd take his bk discharge and filing documents to an estate lawyer and determine how to proceed.