Creditors must file a proof of claim in order to receive payments as part of a bankruptcy case. This practice occurs in Chapter 13 bankruptcy cases and Chapter 7 cases in which there are assets available to be distributed. As of Dec. 1, 2017, the Federal Rules of Bankruptcy Procedure enacted new rules regarding filing a proof of claim:
- It clarified that secured creditors are required to file a proof of claim; and
- It shortened the deadline for a non-governmental creditor to file a proof of claim from 90 days to 70 days.
Both of these changes are meant to favor the debtor in a bankruptcy case. The shortened deadline may allow a Chapter 13 bankruptcy filer to know sooner what claims the creditors have in the case. Debtors must monitor proof of claim filings to determine whether they need to contest a filing.
Reasons to Contest
Debtors can file a written objection to a proof of claim. Reasons for objection may include:
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