Creditors Still Have Rights When Debtors Claim Bankruptcy

Creditors may find themselves involved in a seemingly difficult debt collection situation when a debtor declares bankruptcy. However, they still have options depending on the specific type of bankruptcy the debtor files for, in addition to how the claim arose and how the case proceeds.

Unfortunately, this can lead to many creditors ceasing to pursue debt collection activities and ending the relationship with the debtor, assuming that all remains lost concerning reclaiming their rightful property.

The good news is that in many debtor bankruptcy situations, the creditor remains entitled to at least a share of the asset distribution as ordered by the court from a bankruptcy estate. The courts will disperse assets based on the priority of claims.

Creditors can utilize the courts to express concerns related to debtor bankruptcy plans, the liquidation of their assets, as well as payments regarding the bankruptcy estate assets. A credit may additionally challenge the debtor’s rights to discharge certain debts in a bankruptcy case.

Recovering owed debtors in a debtor bankruptcy case isn’t easy and often remains complex litigation. In any scenario, hiring creditor bankruptcy representation in Brickell is crucial to a positive outcome.

Important Information on Debtor Bankruptcy and Debt Collection

When a debtor declares bankruptcy and begins the process, this initiates what we call an automatic stay. The automatic stay protects debtors and their property from collections during a bankruptcy proceeding. Creditors should cease all collections actions including:

• Billing
• Lawsuits
• Telephone Calls

However, a creditor rights attorney can file a claim with the court to a portion of the bankruptcy assets. When the debtor files for bankruptcy, the court will send notice to their creditors outlining where they can file a proof of claim, as well as the deadlines and stipulations to filing an action.

Creditor bankruptcy representation in Brickell must act quickly in most cases. The court will impose a strict deadline to file any actions in a bankruptcy case. If a creditor should miss the date, they will be out of luck reclaiming what the debtor owes.

An attorney for creditor bankruptcy representation in Brickell will guide clients on the debtor’s potential to discharge debts, and whether or not pursuing a claim on the debtor’s assets remains a viable option to recover the debt.

Asset Secured Debt in Debtor Bankruptcy

Some creditors may possess a lien against debtor property. Asset liens offer creditors specific rights to debtor property, acting as collateral for their claim. A deed of trust, judgment lien, or security contract on the debtor’s property will outline and implement rights to the property during a debtor’s bankruptcy.

Creditors with secured assets experience the best possible chance to reclaim compensation for the debt owed during the automatic stay period. Creditor bankruptcy representation in Brickell can seek protection payments intended to prevent equity decline concerning the claim and guide creditors on the validity of secured claims.

Attorneys work to monitor active situations in a debtor bankruptcy case and determine the best recourse for their creditor clients. The court may even dismiss a bankruptcy filing when the debtor cannot comply with imposed requirements. This essentially enables creditors to pursue collection activities as if the bankruptcy filing never took place.

Changes may take place throughout a debtor bankruptcy case. A non-viable case regarding assets can change quickly and creditors must be ready. This is why it remains essential to secure creditor bankruptcy representation in Brickell to monitor the situation and obtain the best possible outcome.

A bankruptcy specialist will have the necessary experience, tact, patients, and creativity to carefully analyze a bankruptcy case, enabling a natural progression that helps creditors to conduct their business as usual.

Creditor Bankruptcy Representation in Brickell | The Law Offices of Paul A. Humbert, P.L.

Our team from the Law Offices of Paul A. Humbert, P.L. works hard for our creditor clients, providing a comprehensive understanding and experience to the table regarding debtor bankruptcy cases. The bankruptcy attorneys from our firm rely on insights they have gained from representing a variety of clients ranging from small businesses to larger companies.

We can help you collect debts during debtor bankruptcy situations and guide you through cases that remain troublesome for creditors in many situations.

To learn more about creditor bankruptcy representation in Brickell and how legal specialists from our firm can help you reclaim assets owed from debtors and handles commercial collections, reach out to our team for a comprehensive case analysis and consultation today!