Call us today for a FREE
initial consultation!

Glossary Of Bankruptcy Terms

Glossary Of Bankruptcy Terms Attorney Los Angeles, Woodland Hills, Encino, Tarzana,Chatsworth and the entire San Fernando Valley

The following is the definition of the terms related to Chapter 7 and Chapter 13 Bankruptcy process: Adversary Proceeding: Filing a complaint with the court about a lawsuit arising in or related to a bankruptcy case. Automatic Stay: This is an injunction that automatically halts lawsuits, foreclosure, garnishments, and all other activity against a debtor on whose behalf a bankruptcy petition has been filed. Bankruptcy: A legal procedure for tackling debts issues for both individuals and businesses alike. Bankruptcy Administrator: This refers to the judiciary officer who serves in the judicial district (Alabama and North Carolina), and responsible for the supervision/administration of bankruptcy (cases, estates and trustees). He/she is also charged with monitoring plans, statements disclosure, creditor’s committees, fee applications and performing other statutory duties. Bankruptcy Code: This relates to the informal name (title 11) of the United States Code (11 U.S.C. §§ 101-1330), the federal bankruptcy law. Bankruptcy Court: A unit of the district court that has subject matter jurisdiction of over bankruptcy cases. Bankruptcy Judge: A judicial officer/court official of the United State District court who presides over federal bankruptcy cases. Bankruptcy Petition: A bankruptcy case opened by a debtor by filing official forms. Chapter 7: A chapter of the Bankruptcy Code that grants liquidation of a debtor’s property to pay off creditors. Chapter 13: A chapter of the bankruptcy code that allows a debtor with a regular income to keep property and pay the debt over a period of five to six years. Claim: A creditor’s right to payment from a debtor or a debtor’s property. Consumer Debts: Debts incurred from personal needs. Creditor: This relates to one who is assumed to be owed. Credit Counseling: Individual briefing from a non-profit and credit counseling agency which a debtor must attend before filing a bankruptcy petition; or an instructional course (in personal financial management) in chapters 7 as well as 13, which an individual debtor must complete before a discharge is entered. Creditor’s Meeting: The meeting of creditors in line with section 341 of the bankruptcy code to question the financial affairs of the debtors. Current Monthly Income: The average monthly income received by debtors over the six calendar months before the bankruptcy case commencement. This includes external inputs and the income of a debtor’s spouse (if the petition is a joint one), but which does not include social security income. Debtor: A person that filed a petition under the bankruptcy code. Discharge: To release a debtor from personal liability certain dischargeable debts in line with the Bankruptcy Code, thereby preventing the creditor from taking any action to collect the debt from the debtor or make any form of contact with the debtor regarding the debt. Debt: A debt for which the Bankruptcy Code allows elimination of the debtor’s personal liability. Equity: The value of a debtor’s interest in property remaining after liens and other creditors’ interest are considered. (For instance, if a car valued at $200,000 is subjected to a $150,000 mortgage, then the equity is $50,000). Exemption, Exempt Property: This refers to certain properties owned by the individual debtor, which the debtor is permitted to pay his/her unsecured creditors according to the bankruptcy code or applicable state law. The availability or amount the debtor is allowed to exempt depends on the availability of the state the debtor lives in. Your expert Attorney Los Angeles, Woodland Hills, Encino, Tarzana, Chatsworth and the entire San Fernando Valley will make you understand the difference between chapters 7 and 13 exemptions. Fresh Start: A purpose of the Bankruptcy Code, which characterizes a debtor’s status after a previous bankruptcy. Joint Petition: This is a bankruptcy petitioned filed together by a man and his wife. Lien: This is the right to sell/hold as payment or security for a debt or duty. Liquidation: A sale of the debtor’s property with the proceeds to be used for the benefit of the creditors. Means Test: A test carried out to determine if the Chapter 7 filing of an individual debtor is an abuse of the Bankruptcy Code requiring dismissal or conversion of the case to Chapter 13, according to section 707(b)(2). It is considered an abuse if the debtor’s aggregate current monthly income over 5 years is more than $10,950 or 25% of the debtor’s non-priority unsecured debt, as long as the amount is at least $6,575. No-Asset Case: A Chapter 7 case where there are no available assets that can satisfy any part of the creditor’s unsecured claims. Non-Dischargeable Debt: A debt that must not be eliminated, despite bankruptcy. This relates to a situation of home mortgage, alimony, child support and debt arising from personal injury caused by driving under the influence of drugs or alcohol, etc. Party In Interest: A party that has standing to be heard by the court in a bankruptcy case. This includes the debtors, creditors, amidst others. Reaffirmation Agreement: An agreement by a debtor to continue paying a dischargeable debt after bankruptcy in line with Chapter 7, usually for the purpose of keeping collateral that would otherwise be subject to repossession. Schedules: A petition showing a detailed list of the debtor’s assets, liabilities, and other financial information, filed by the debtor. Secured Creditors: This refers to a creditor who has the right to hold or sell certain property of the debtor to clear all or some of the claims. Statement Of Financial Affairs: A declaration concerning plans to deal with consumer debts that are secured by properties of the estate, in line with Chapter 7. Trustee: A representative (of the bankruptcy estate) who exercises any given statutory powers, for the benefit of the unsecured creditors, under the general supervision (of the court), and the supervision (direct) of the U.S. trustee or bankruptcy administrator. The trustee has the responsibility of reviewing the debtor’s petition, schedules, and acting towards the creditor or debtor to recover property of the bankruptcy case. U.S. Trustee: An officer of the justice department responsible for the supervision of the administration of the bankruptcy cases by monitoring plans and disclosure statements. Under-secured Claim: This is a debt secured using property that is worth less than the value of the debt. Un-liquidated Claim: A claim without a determined specific value. Un-scheduled Debt: A debt exempted by the debtor from the schedules filed with the court. Unsecured Claim: A claim or debt with no special assurance of payment by the creditor; such as a lien or mortgage. Voluntary Transfer: The debtor’s consent to transfer the debtor’s property. It is my joy as your Attorney Los Angeles, Woodland Hills, Encino, Tarzana, Chatsworth and the entire San Fernando Valley to explain more of these terms to your level of understanding. Contact the Leventhal Law Group, P.C. I specialize in helping individuals and small-to-medium sized businesses file for Chapter 11 Bankruptcy, Chapter 7 Bankruptcy, or Chapter 13 Bankruptcy as the case may be. My office offers free consultations too. Call me today at 818-347-5800, or visit my office which is conveniently located near 101 Freeway in Woodland Hills – at the west end of the San Fernando Valley.

Get in Touch

[contact-form-7 id="8" title="Contact Form"]
Visit Us On TwitterVisit Us On Facebook