Proof of ClaimCredit Repair Definition
A form filed in bankruptcy court by a creditor stating the amount owed to them by the debtor.
Definition
A proof of claim is a formal document filed by a creditor in a bankruptcy case to assert their right to receive payment from the bankruptcy estate. The form details the amount of debt owed by the debtor to the creditor as of the bankruptcy filing date, the basis for the claim (e.g., loan agreement, services rendered), whether the claim is secured or unsecured, and whether it qualifies for priority status. Filing a proof of claim is generally necessary for unsecured creditors (like credit card companies or medical providers) to receive any distribution from the bankruptcy estate in Chapter 7 (if assets are available) or Chapter 13 cases. Secured creditors may also file proofs of claim. There are specific deadlines for filing proofs of claim set by the bankruptcy court.
Frequently Asked Questions
Who needs to file a proof of claim?
Generally, unsecured creditors *must* file a proof of claim by the court's deadline (the 'bar date') to be eligible for payment from the bankruptcy estate. Secured creditors often file proofs of claim as well, although their rights are primarily tied to their collateral. Debtors might file a proof of claim on behalf of a creditor if the creditor fails to do so, especially for non-dischargeable debts the debtor wants included in a Chapter 13 plan.
What happens if a creditor doesn't file a proof of claim?
If an unsecured creditor fails to file a proof of claim by the deadline, they typically forfeit their right to receive any distribution from the bankruptcy estate for that debt. The debt may still be discharged (if it's dischargeable) even without payment.
Can a proof of claim be disputed?
Yes, the debtor, the bankruptcy trustee, or other parties in interest can object to a proof of claim if they believe the amount is incorrect, the claim is invalid, or it's improperly classified (e.g., claimed as secured when it's unsecured). The bankruptcy court resolves such objections.
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