If you clicked on this article, chances are you might be a creditor in a bankruptcy case.In cases of bankruptcy, the court will find assets that can liquidate to pay back. In other cases, the debtor makes monthly payments for up to five years. So, you will have a chance of getting something, but only if you take the time to fill out, document, and file a proof of claim form.
This article will help guide you through the form if you’ve been named as a creditor in a bankruptcy case.
General Components of Proof of Claim Form
A proof of claim contains a lot more explanation and notes than the previous versions, as it is modified by the government as of 2016.
1. Debtor identification
At the top of the form, there should be a box for an identification of the debtor by name, the case number, and the bankruptcy court in which the case is pending. You can determine the name of the bankruptcy court and the case number by looking among other documents you have received from the court.
2. Claim identification
Next comes a series of information that identify your claim. If you’re the creditor, identify that here.If you obtained the right to the claim from another person, identify the person here.
The court’s claims registry is the court’s list of claims filed. You can obtain the number for the original from the office of the clerk for the bankruptcy court where the case is pending.
3. Additional documentation of support
In the next part, you should insert how much the debtor owes you. Keep in mind that you will be required to support your claim with additional documentation.If the claim includes any interest or other charges already accrued, state that in the other space provided.
4. Nature of the claim
This is where you would put the nature of your claim. Some instances are “money loaned” or “services performed.” You can provide whatever description that best fits your own claim.
5. Collateral and signature
If the debtor puts up collateral on the debt, it is secured. The claim is only secured up to the value of the collateral. Beyond that, the claim is unsecured.
Finally, you are required to identify yourself and sign the form. Every claim form is signed under penalty of perjury, which means you can be prosecuted, filed, or even jailed for lying on the form.
It is essential for you to collect any supporting documentation you have in attachment with your claim form. This includes promissory notes, contracts, invoices, security agreements, or others that prove the agreement. You may also submit things such as monthly statements, pay records, and ledgers.
These supporting documents will show that a legal debt exists, as well as the balance owed on the debt. Without the supporting documents, the proof of claim is incomplete and will likely to face an objection from the trustee or the debtor.
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When to File a Proof of Claim
If the bankruptcy trustee finds assets of the debtor that he or she can sell or liquidate, he/she will have to notify the creditors first that there will be a distribution. In this case, you will be notified of a deadline to file your proof of claim form. If you don’t, no payment will be made, even if the claim validity is already secured.
You will have approximately 90 days after the meeting of creditors to file your claim form. If your debt is secured, but there is no claim form filed, the debtor can file one for you to ensure you’re paid. When that happens, you have no control over what the debtor includes in the form.
Objections to Proof of Claim
Most proofs of claim are approved by the court. But in other cases, the debtor, trustee or another party can make objections to your claim before a judge grants that approval. Here are some common reasons that may apply:
- If the claim amount is incorrect.
- If the claim indicates a debt is secured when it is not.
- If the creditor fails to provide any supporting documentation
Any objections must be received in letters by the bankruptcy court. This should come in attachment with a copy. It is served to the creditor at least 30 days before a hearing
In summary, if you’re a creditor who is named in a bankruptcy case, you can’t stake your claim unless you file a proof of claim form to the bankruptcy court in a duration provided. This form can be downloaded from the court website. Keep in mind you need to support your claim with documents that establish a relationship with the debtor, outlining the nature of the debt and how much money you owed.