Bankruptcy Claims
Author: Mercy Maranga
Claiming bankruptcy can be a good way of getting relief from your debts. However before you go down this road, you have to be sure that all other avenues have been exhausted. This is usually a last resort for many debtors, when they feel they have too much financial baggage and creditors are breathing down their necks. You will also get a peace of mind. There are downsides to this too. You can end up with no assets and are forced to start from scratch. In addition, you can do very little to hide the fact that you are bankrupt because this is the one debt solution that is highly publicized.
The best way to go about this is to first talk to a bankruptcy lawyer. Since there are so many types of bankruptcy, the lawyer should be willing to advise you on the best option depending on your situation. Your lawyer should then help you in which type of bankruptcy you will need to file. Most people file under Chapter 7(liquidation of assets and the proceeds used to repay creditors), Chapter 11 (which allows a debtor to reorganize payments) and Chapter 13(whereby a creditor gets repayments from the debtor’s paychecks).
If you go the Chapter 7 or Chapter 13 way, there is a requirement by the creditors to file a “proof of claim”. This document is simply evidence you do indeed owe your creditor. The way this works is once you have listed your creditors and file for bankruptcy, they are notified to file a proof of claim against you for the debt that is owed to them. This now makes your creditors responsible for the documents and deadlines. After the proofs of claim are filed it is necessary to review them.
Each creditor’s proof of claim is revisited, throughout the proceedings and each creditor’s case considered as you resolve your debt once you get a discharge.
Article Source: http://www.articlesbase.com/finance-articles/bankruptcy-claims-1109790.html
About the Author
Mercy Maranga writes content on Finance and Debt Management. Visit her site here for more information on Finance and how to effectively Manage your debts. Bankruptcy
Can a creditor of a loan send me to small claims after i have retained a bankruptcy lawyer?
CAN A CREDITOR OF A LOAN STILL CALL ME AFTER I HAVE ALREADY RETAINED A BANKRUPTCY LAWYER? NOTE THAT I HAVE NOT PAID THE LAWYER IN FULL. I WILL PLAN TO IN FEB 08.
Can a legal accountant charge you for assisting in completing and filing a bankruptcy claim?
We are in the process of filing for a bankruptcy. We made the mistake of paying a legal accountant to assist us in preparing the forms and filing it. When we went to our first meeting of creditors there were many serious mistakes. Fortunately our trustee continued our case to allow us to make the correct amends and we are now consulting a lawyer to help us do it correctly. What happens to the person who charged us? The trustee asked for all the information on this person. A lawyer told us this person was practicing law without the law license. Does this person get charged with a crime or what happens, I’m just curious.
Is it true that you have to be so many months behind on your bills before you can claim bankruptcy ?
I know I am losing my job in 3 weeks due to a layoff. I am going to have to claim bankruptcy, I know, becuz I have a ton of credit cards and will not be in the position to pay them. A friend suggested a local lawyer to me but also said that he thought I’d have to wait and endure months of harassing phone calls before I’d be ‘eligible’ to file for B. Anyone have any answers on that ?
How can I find out if a bankruptcy lawyer in Los Angeles is trustworthy?
I’m trying to find a reputable and affordable bankruptcy lawyer in the Los Angeles area but there are many sites, ads in the paper of people who claim to be attorneys when they are not. Please advise ….
When you claim bankruptcy in NY, Do you have to speak to the judge yourself?
I made a mistake with my debt 2 years ago, im seriously considering bankruptcy. Im just so scared im going to have to explain everything to the judge myself. Im going to hire a lawyer to do the bankruptcy for me but im such a shy person and i clam up when im under pressure.
Does the judges ask you when you first started getting the debt?
Also does the judge ask you how come you have so much.
Try a California Bar Certified Lawyer Association, they can direct you to a screened lawyer in your area.
http://www.1000attorneys.com/
It would be in your best interests to pay your attorney as soon as possible. As you’ve been told, retaining a lawyer and filing for bankruptcy protection are two separate things.
Once the filing has occurred, an automatic stay goes into effect. The automatic stay prevents a creditor from contact you, suing you, or repossessing your property.
Once you are served a Summons and Complaint through small claims court, you do have 10 to 30 days to respond (based on your local laws and rules). Failure to respond during this time will cause a judgment by default and this is not a good thing.
Once a creditor has a judgment against you, they can start further collection activities. Your wages can be garnished and your property can be seized and sold. While this does not happen in about half of these cases, you do not want to run the risk of getting your wages garnished.
While you are on thin ice, do not despair. Even if your creditor does get a judgment against you, if you do successfully file for bankruptcy and receive a discharge, the creditor’s judgment will be useless.
You also need to contact your attorney as soon as possible. Let him know what is going on and that you are being faced with the threat of legal action. The attorney may discount his fees enough that you can retain him and file your bankruptcy. Much of the fees your attorney charges are his fees and not the fees of the court. While the attorney cannot file your bankruptcy while you owe him money, he does have the right to discount his fee.
Another possible option is to contact the legal aid or public assistance offices in your area. Chapter 7 bankruptcy is pretty straightforward and if you are facing the threat of legal action, the legal aid department can refer you to an attorney who will not charge you a fee or who will charge significantly less than another attorney.
I wish you the best of luck with your situation!
**I have not provided any legal advice. While I am an attorney, any reference to any law is for informational purposes only. You should seek competent representation in your state. **
I don’t know about NY bankruptcy laws, but congrats on taking this very scary step. I was facing bankruptcy 13 years ago, and was able to do what we call in Canada an “Orderly Payment of Debt”. This is one step removed from Bankruptcy, and is the preferred method of dealing with debt where and whenever possible. The Credit Counseling Bureau dictated the interest rate to my creditors (5% at the time), and the amount of my monthly payments. The monthly payments were based on what I could afford at the time. My responsibility was to pay down all my debts. Also, closing all my credit accounts was mandatory. Like in bankruptcy my credit rating was affected by this, but it also gave me the time to learn how to live on a cash-only basis, and take responsibility for the debt I had created. To this day I will use cash whenever possible, and think twice before charging larger purchases.
Good luck with your situation.
You can review more bankruptcy information at their official website @ http://www.usbankruptcy.gov Make the appointment to see the attorney your friend referred. Most will see you free the first time. Depending on what your income is and the status of your debts, we really can’t tell you when you can file. The attorney will be able to tell you what you can and can’t do, and with the new laws, there are some changes on qualifying and what you have to do mandatory per the new bankruptcy laws. You shouldn’t have to endure months of harassing phone calls as you are losing your job and won’t be able to make payments, but an attorney is who you need to consult. You can review the website I provided to gain more information on how each chapter in bankruptcy works and what you will need to do and have for a filing. Good Luck!
Yes. Under the new statutes and the rules of court, a non-lawyer has to file a form with the court disclosing all fees you paid them to prepare your petition or assist you, and also may be liable for any losses you incur.