As a Walworth County bankruptcy attorney who represents creditors, you can only imagine how many questions I get asked during initial consultations. I am more than happy to answer all of your questions. Creditors in bankruptcy have every right to be concerned about their owed debt. Depending on the type of bankruptcy the debtor has filed, and a few other details, your options as a creditor can vary. Below you will find answers to some of the most commonly asked questions by creditors in a Walworth County bankruptcy.
Question 1. I have a judgment against the debtor. The debtor has now filed bankruptcy. Can I still collect on the judgment?
Answer: The answer is no. You cannot collect on your judgment any longer now that the debtor has filed bankruptcy. You may have other options to pursue depending on the type of bankruptcy filed by the debtor. Consult your Walworth County creditor bankruptcy attorney for your options and advice.
Question 2. I have a lien against the debtor’s property. Will my lien be removed when the debtor files bankruptcy?
Answer: The truth is that this answer is complicated. It varies depending on various circumstances, such as: Is the property the debtor’s principal residence? What chapter of bankruptcy did the debtor file? What is the value of the property? Are there any other liens on the property? What is the underlying type of debt which caused the lien? If you are faced with the possibility of your lien being removed due to a debtor’s bankruptcy, please contact your Walworth County creditor bankruptcy attorney. Your attorney will need to discuss the minute details with you in order to provide an accurate answer, as well as your options.
Question 3. I am an unsecured creditor (provided services with no collateral). How do I know if the debtor revealed all assets?
Answer: You can obtain a copy of the bankruptcy filing from the clerk of the court. You have every right to review the paperwork. You also have the right to depose the debtor to obtain more details about the debtor’s assets.
Question 4. I am owed money by a debtor who recently filed a Chapter 7 bankruptcy. What types of debt can be discharged?
Answer: See the below list. Remember, there are special circumstances for almost each of the items listed.
-credit card charges and fees
-department store cards
-past due rent or any other money owed under a lease agreement
-civil court judgments
-auto accident claims
-personal loans from family and friends
-amounts owed to bank from “insufficient funds” checks
Question 5. I am owed money by a debtor who recently filed a Chapter 13 bankruptcy. What does this mean?
Answer: Chapter 13 is a proceeding under which a debtor proposes to his or her creditors and the court, a plan that enables the debtor to repay as much debt as is feasible given the debtor’s financial circumstances. To be confirmed by the court, a plan must provide that the debtor’s future income be subject to court administration. After determining a reasonable budget, the debtor’s remaining income is paid (generally monthly) by the debtor’s employer to the trustee who, after taking a commission, pays the creditors according to the plan provisions. A plan generally lasts three years, but may last up to five years if the court approves the longer period, or if a debtor is required to propose a five-year plan due to their income level. At the end of the plan, the debtor is entitled to receive a discharge of any remaining debt (some exceptions apply).
Question 6. I am currently suing a debtor. The debtor has now filed bankruptcy. What happens with my lawsuit?
Answer: You must now obtain permission from the bankruptcy court to proceed with the lawsuit.
Question 7. A debtor who owes me money has filed Chapter 7 bankruptcy. I would like them to reaffirm the debt. How can this come about?
Answer: The truth is that it probably won’t happen. Debtors get to choose which debts to reaffirm (promise to repay as originally agreed and not discharge through bankruptcy). Although reaffirmation of your debt would be advantageous for you as a creditor, it is not advantageous or recommended for a debtor. Reaffirmation commits the debtor to payments they may not be able to afford after bankruptcy. The debtor could quickly become overwhelmed and back into the same position they are in now.
Question 8. The debtor owes me money but didn’t list me as a creditor. Can my debt still be discharged by the bankruptcy court?
Answer: The odds are against you. Normally, a proof of claim must be made with the bankruptcy court before a debt can be discharged. There is a deadline to file the proof of claim. However, if no assets were distributed during the bankruptcy, some courts will discharge debts not listed in the bankruptcy petition. You can possibly get the time period for filing a proof of claim extended. Consult with your Walworth County creditor bankruptcy attorney for details.
Question 9. I received notice of a debtor’s bankruptcy. Should I attend the 341a Meeting of Creditors?
Answer: Yes, if you would like to question the debtor under oath regarding any of their assets or the paperwork filed with the court.
Contact Our Walworth County Creditor Bankruptcy Attorney
Representing creditors in bankruptcy requires a high level of diligence and skill. If you need legal advice or representation as a creditor in a Walworth County bankruptcy, feel free to contact Wynn at Law, LLC. Our Walworth County creditor bankruptcy attorney represents clients in complex bankruptcy litigation. You can reach us by phone at 262-725-0175 or by email via our website’s contact page. Wynn at Law has offices conveniently located in Lake Geneva, Delavan, Salem, and Muskego.
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*The content and material on this web page is for informational purposes only and does not constitute legal advice.