Creditor Objections in a Bankruptcy

Occasionally, creditors will file objections to being included in a bankruptcy; while some of these are valid, some of them are not. A creditor is permitted to object within the permissible time frame, and they may appear at the 341 (meeting of the creditors) to voice their objection and ask some preliminary questions. This is not the time for a deposition, if you are a debtor you and or your attorney should object to the same.

Creditors who are owed a significant amount of money or have a secured claim may object to the discharge of their claim. The Creditor will possibly attempt to collect some part of the outstanding debt, (if the trustee can discover assets). A creditor can also require that the property that secured the debt be returned to them (a car, furniture, etc).

If a Creditor can prove that the claim is not dischargeable in the bankruptcy due to an exception (most common being fraud by the Debtor), they will seek relief from the bankruptcy court to have their claim “dismissed” from the bankruptcy, and that creditor will not be affected by the discharge.

A lot of debtors do not realize that filing the incorrect schedules (intentionally or unintentionally) can cause significant fines, the bankruptcy being dismissed or even spending time in federal prison; therefore, it is important to have an attorney assist you with the bankruptcy in order to understand the case and what you should and should not include in your schedules.

The attorneys here at Schwam-Wilcox & Associates have been providing bankruptcy services to the community since 2002, and we take pride in our attention to detail, our full explanation of the process to the debtor and our ability to have debt lawfully discharged. Further, we have had experience with creditors who attempt to have their claim dismissed from the discharge.

To learn if bankruptcy is right for you and your family (or your business) please contact the firm of Schwam-Wilcox & Associates for consultation, which is complimentary for personal bankruptcy cases.

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