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cfortunato
cfortunato, Attorney
Category: Bankruptcy Law
Satisfied Customers: 8023
Experience:  Bankruptcy professor.
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If I signed a promissory note that has terminology saying it

Customer Question

If I signed a promissory note that has terminology saying it can't be 'erased' via a bankruptcy...if I do end up filing bankruptcy would this note payable not go away?
Submitted: 5 years ago.
Category: Bankruptcy Law
Expert:  cfortunato replied 5 years ago.

cfortunato :

Hi JACustomer,

cfortunato :

The right to file a Bankruptcy is protected by the US Constitution, and as such, It is not possible to sign away one's right to file a Bankruptcy.

cfortunato :

In other words, even though the promissory note says it cannot be discharged in a Bankruptcy, it can be discharged in a Bankruptcy.

cfortunato :

If it were possible to sign away one's right to file a Bankruptcy, most credit arrangements would require the person borrowing the money to sign away their right to file a Bankruptcy.

JACUSTOMER-mgy6ogd1- :

I understand that....my question is if I signed a personal guarantee that says...in the event any payment or oterh satisfaction of an obligation is avoided, recovered, rescinded or must otherwise be repaid or returned by the beneficiary in any action or proceeding with respect to or as a rsult of any claim arising or relating to bankruptcy, insolvency, reorganization or .....guarantors shall remain obligated with respect to such avoided, rescinded amout as if such payment or safitsfacition had never been made to beneficiary. it goes on to say bankruptcy cannot impair or be a defense to affect the obligations of guarantor. Is this legally binding if there is a bankruptcy?

JACUSTOMER-mgy6ogd1- :

I understand that....my question is if I signed a personal guarantee that says...in the event any payment or oterh satisfaction of an obligation is avoided, recovered, rescinded or must otherwise be repaid or returned by the beneficiary in any action or proceeding with respect to or as a rsult of any claim arising or relating to bankruptcy, insolvency, reorganization or .....guarantors shall remain obligated with respect to such avoided, rescinded amout as if such payment or safitsfacition had never been made to beneficiary. it goes on to say bankruptcy cannot impair or be a defense to affect the obligations of guarantor. Is this legally binding if there is a bankruptcy?

cfortunato :

Absolutely not! If that statement were legally binding, that would be the same as signing away one's right to file a Bankruptcy.

cfortunato :

That terminology is unenforceable and not legally binding.

cfortunato :

Is there anything else you would like to know?