The reason you filed for the protection of a Chapter 13 Bankruptcy was because creditors were causing you a problem. The creditor may have simply been calling you, suing you or even threatening to take your personal or real property. In order to keep from losing your stuff, you filed a Chapter 13 Bankruptcy.

Now, you, the debtor, and your attorney need to make sure that your creditors are bound by the terms of the Chapter 13 plan. A chapter 13 Bankruptcy Plan will force creditors to leave you and your property alone, but, it will only do that if the creditor is treated in the plan.

Unsecured creditors may do nothing and not file a proof of claim and still be bound by the Chapter 13 plan. The problem occurs when a priority or secured creditor does not file a proof of claim. What happens is that the unsecured creditors will be paid more, but, your secured creditor or priority creditor does not receive what it should have received in the plan.   This produces some very unpleasant results that no debtor will like.

An easy example of this is when you owe priority taxes that are not filed. The unsecured creditors receive the money you planed to pay the priority creditor and you complete the payments you owed pursuant to your confirmed Chapter 13 Bankruptcy Plan. You think that you are finally free to start over only to find out that the taxes you thought you would have paid in your Chapter 13 Bankruptcy Plan were not paid. The taxing authority is coming after you for the taxes that were not paid. You get to pay those taxes a second time and your pay may even be garnished while the priority taxes that were not paid as a part of your Chapter 13 Bankruptcy Plan are finally being paid.

Because you are paying the taxes a second time, your fresh start is only a dream. You are paying money that you thought that you would have for yourself and/or your family.  A similar result happens when a secured creditor does not receive the payments that it was to have received as a part of your confirmed Chapter 13 Bankruptcy Plan.

The car that you thought you had paid for is not paid for or the mortgage company says it is still owed those payments that you were behind on when you filed you Chapter 13 Bankruptcy Case.  You may have to pay those payments again to keep your house or car or other property that was secured by debt when you filed your Chapter 13 Bankruptcy Case.

This is a nightmare for both the debtor and the attorney.  Try explaining what happened because you did not do your homework.  The Trustee’s website will show you if the creditor has filed its proof of claim. You can also see if the amount claimed is the amount you thought you owed.  If the amount seems wrong, you can contact your attorney to take an additional look at the claim to make sure it is for the correct amount.  Your attorney can also file a proof of claim in your Chapter 13 Bankruptcy Case if the creditor fails to file its own proof of claim.

The debtor should check, until the bar date passes, at least weekly for claims that have been filed. Let your attorney know if a claim is wrong so an objection can be filed if required. Most of the time, the creditor will file the claim correctly. However, mistakes occur and it is up to YOU, THE DEBTOR to watch the claims filed by your creditors.

You want to do this until the BAR DATE passes so that the claims of creditors are properly filed.  There will be a post on the bar date to more fully explain what a bar date is, how to determine when it applies and how to find the Bar Date on your paperwork.


About Nathan Davis, Esquire

Born in Charleston, South Carolina, Nathan Davis has been practicing law for many years. Mr. Davis has a wide variety of experiences having practiced domestic relations, criminal law, social security law having also practiced collection law in the past. This knowledge is helpful when someone needs to restart their financial life. The practice is now primarily bankruptcy and debtor representation work, but, Mr. Davis continues to also practice real estate law, trusts and estates and a general litigation practice. I believe that the most important part of representation is trying to leave you better off when the case is finished than when you started. Although I will do as my client directs, I will always tell you if I think that you are making a mistake. Bankruptcy is about a "fresh start". If you do not make changes in what you are doing, you will be doing what you are doing now in the future. There is no shame in bankruptcy or other steps that you may take to start your life over. Too often, people worry more about things than about themselves, their family or their future.
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