Serving Northern Virginia



P. O. Box 10470
Burke, VA 22009-0470

Creditors' rights in bankruptcy

   A "creditor" is any anyone who may have a right to receive money from a person who is in bankruptcy. The person in bankruptcy is called a "debtor".
   Creditors sometimes misunderstand their rights regarding their claims against debtors. Creditors should know that:

  1. Each creditor should file with the clerk of the bankruptcy court a one-page form called a "Proof of Claim." If this form is not timely filed, a creditor may forfeit all of its rights to receive payments on its claim. The form does not guarantee that a payment will be made. Nonetheless, in a number of cases, creditors who have filed a Proof of Claim have been known to receive from a bankruptcy proceeding as much as a 100% of their claimed amouts. Most bankruptcy attorneys can electronically file (over the Internet) Proof of Claim forms for their clients.
  2. Creditors may be heard by the court in all matters that affect the administration of a debtor's estate. This includes: (a) debtors' plans (in cases under chapters 11, 12, and 13) and transactions involving the debtors' properties, and (b) payments from the assets of the debtors' estates.
  3. In almost every bankruptcy case, the debtor seeks to have the court issue an Order of "Discharge."  That order is important.  It will relieve the debtor of all obligations to pay the debts owed to the creditors. In proper circumstances (e.g., in cases involving certain types of fraud, etc.), the court can refuse to issue a Discharge order or it can issue an order excepting a particular creditor's claim from a Discharge order.  If that happens, the creditor(s) will be able to continue with their efforts to collect the debt(s).  A most important fact: Unless someone complains to the court, the court may automatically grant a debtor a Discharge. A creditor who believes that a Discharge should not be allowed, or that a particular claim should not be discharged, should immediately contact a bankruptcy attorney. The right to complain or file objections to a "Discharge" is limited to a short period of time after the bankruptcy case has been started.

Please call to schedule an initial consultation. If you are a debtor considering bankruptcy, please read our list of items to bring for your interview


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