FILING PROOF OF CLAIM
If a creditor (whether secured or unsecured) has a claim against a debtor who has filed for bankruptcy (whether the bankruptcy is a Chapter 7, 11, or 13), the creditor is entitled to file a proof of claim in the bankruptcy case to show that the creditor has a valid claim against the bankruptcy estate. If the amount of the claim is already liquidated, then the claim is filed for this amount. But there are times when the claim is unliquidated and needs to be determined/litigated by the bankruptcy court, or sometimes the parties will allow the state court to decide (if, say, the matter is already being litigated in state court). If the claim is ultimately allowed by the bankruptcy court, and there is a distribution in the case, then the creditor will be paid on a pro-rata basis. There are certain claims that are entitled to superiority over others, and this may affect when, and how much, the creditor is paid.
If you are a creditor and do not file a proof of claim, you will not get paid through the bankruptcy and your claim against the debtor will likely be discharged/wiped away. Also, a creditor must keep in mind that there are time limitations associated with filing a proof of claim. Failure to strictly abide by these deadlines can result in the forfeiting of your right to recover funds from the debtor’s bankruptcy estate. Late filed proofs of claims are very rarely paid, as they are treated as a subordinate class to timely filed proofs of claims of general unsecured creditors. This means all other creditors have to be paid in full before the late filled claimant can be paid a penny. Some exceptions do exist, but they are rarely applicable and immediate attention must be paid to the proof of claim deadline set by the bankruptcy court.