Preferential Payments And Their Impact On Bankruptcy Filings
I borrowed money from my father, can I pay him back before I file?
While you could pay him back, it can still cause problems for your bankruptcy. Well, that would be considered a preferential payment, and if you were to make that payment, the trustee could seek to invalidate it. The trustee could go to your father and ask for your father to pay that money back into the bankruptcy estate or the trustee could come to you and ask for you to pay it back. So, you may have paid your dad and still end up having to pay that money into the bankruptcy estate. If you wanted to pay your father after filing for bankruptcy you could still do that. Just because you get a discharge of debt, doesn't mean that you can't choose to still payback your friends, family, any creditor that you prefer. You can go ahead and pay back after the bankruptcy discharge. But the discharge will mean that you no longer have a legal obligation to do so.
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