If you file Chapter 13 bankruptcy or have any non-exempt assets that the trustee can liquidate in a Chapter 7 bankruptcy, your creditors will receive a notice that they need to file a proof of claim if they want to be paid. The claim must show the basis of your debt and how much you owe. The deadline to file a proof of claim is 90 days after your creditors meeting. If a creditor fails to meet the deadline, it may be prohibited from receiving anything.
Most filers, especially in a Chapter 7 bankruptcy, won’t be concerned about whether or when a creditor files a claim. If you’ve hired an attorney, he or she should be monitoring the filed claims. However, in certain cases you want to make sure that a claim has been made on time. For example, if you owe back taxes those must be repaid over the course of your Chapter 13 repayment plan. But if a claim isn’t made, the trustee won’t make any payments. This can end up derailing your bankruptcy. The same is true if you owe arrears on your home mortgage. Also, in some cases a Chapter 13 filer may be required to pay 100% of all timely filed claims. If an unsecured credit files a late claim, your attorney will likely want to file a motion to disallow the claim to avoid you having to pay more than you should.
If you have questions about the bankruptcy process, we hope you’ll give us a call or come in for a free, no-obligation consultation with an experienced Colorado bankruptcy attorney. You can schedule an appointment by calling 303.331.3403 or by using our online scheduling system.