(This is a creditor question, and I don’t represent creditors. I represent the people who need to seek bankruptcy protection from creditors, but I get asked the question enough that I thought it would be easier in the long run to have an answer on my blog).
I get the following email all of the time from creditors. I don’t represent them, and if they have any questions, they really should hire their own collection attorney. That being said, I can at least steer them in the right direction, and I usually do. Courtesy pays, and that karma thing is real.
This morning I received an email from a creditor that said:
We have an outstanding bill for water mitigation services performed by
XXXXX, who we represent, on Ms. XXXX’s home in May 2016 for
$2655.36. I am emailing to inquire where to send this bill to include it
in the bankruptcy, and to ask if XXXXX can expect to be paid as a part
of Chapter 13.
I responded and sent them to the bankruptcy court website here in Utah. If you are a creditor in a chapter 7 or a chapter 13, there is a chance that the debtor (person filing bankruptcy) will be paying out some money to his creditors. Sometimes, it is only pennies on the dollar. However, in some cases, the debtor has to pay our 100% of properly filed claims. The key phrase there is “properly filed.” If you don’t file a claim, you won’t get paid.
I filed a case a couple of years back for a collector for a large credit card company. She was in a 100% repayment plan with her chapter 13, and she owed about $15,000 on a credit card with her employer. Her employer (a solid collector), filed its claim 2 days late with the bk court, and that $15,000 claim was wiped out with a total repayment of $0.00. They were only 2 days late!
Sometimes a creditor may file a claim that may be improper (such as a 10 years old collection bill for a credit card where the statue of limitations was only 6 years), and those claims can be knocked out as well. However, it is guaranteed that the creditor will receive nothing if they don’t even try to file a claim.
Here is the bk court page for filing a proof of claim.
Their instructions are very straight-forward:
To file a claim for a case in the District of Utah, complete a Proof of Claim form.
Do not include any personal identifiers on the form. In compliance with Fed. R. Bankr. P. 9037 a filing (any document or attachment to a document) made with the Court must not contain certain information, including
an individual’s social security number,
- a taxpayer identification number,
- an individual’s birth date,
- the name of a minor, or
- a financial account number.
Such information must be removed or edited. The document shall only contain:
- The last four digits of the social security number and taxpayer-identification number
- The year of the individual’s birth
- The minor’s initials
- The last four digits of the financial account number
The party filing a document is responsible for redaction. The Clerk’s Office does not review documents filed with the court for compliance with this rule
The original claim and any supporting documents are filed with the Clerk’s Office. Proof of Claims may be filed electronically with a Limited User – Claim Filer electronic filing account, hand-delivered to the Courthouse, or mailed* to:
United States Bankruptcy Court District of Utah
350 South Main St.
Suite 301 Salt Lake City, UT 84101
*If claim filers wish to have a conformed copy; please include an extra copy and a self-addressed stamped envelope.
It is fairly simple, and you should be able to prepare and file the proof of claim on your own. However, it may be a good idea to consult with a collections attorney to make sure you do it right. Because, if you mess up on your proof of claim, you will most likely receive nothing.