Listed below are some of the most common words and legal terms you will hear throughout the bankruptcy process:
Adversary Proceeding
A U.S. Bankruptcy Court hearing to address a lawsuit or complaint a creditor may file in response to a bankruptcy filing.
Automatic Stay, Motion to Lift the Automatic Stay
A legal injunction that will automatically stop all creditor collection actions against the individual filing bankruptcy, including lawsuits, foreclosures, lien actions and garnishments. If certain conditions are met, a creditor may file a legal motion to lift an automatic stay and resume collections activities.
A legal procedure available to individuals, married couples and business owners for eliminating or reorganizing debt. See also Chapter 7 debt elimination and Chapter 13 debt reorganization.
Bankruptcy Trustee
An officer of the federal bankruptcy court system, responsible for supervising and administering U.S. Bankruptcy Court cases, including overseeing estate administration, debt reorganization plans, creditors' committees, court fees and other statutory duties.
Bankruptcy Code
The informal name for title 11 of the United States Code (11 U.S.C. §§ 101-1330), the federal bankruptcy law.
Bankruptcy Court
The federal district court and judges responsible for handling all matters related to the U.S. Bankruptcy Code.
Bankruptcy Estate
All legal or equitable property interests of the debtor listed in the bankruptcy filing, even if owned or held in control by another party.
Bankruptcy Judge
The U.S. federal district judge who serves as the court official over bankruptcy cases that come before the court.
The legal term for the bankruptcy filing documents. Filed by the individual or by creditors forcing the debtor into bankruptcy.
The chapter of the U.S. Bankruptcy Code that allows for the liquidation and/or elimination of the petitioner's debt obligations to creditors.
Chapter 11
Debt reorganization bankruptcy petition usually reserved for a corporation or partnership. Most commonly referred to as business bankruptcy.
The chapter of the Bankruptcy Code providing for reorganizing debt under a structured, court-supervised repayment plan, generally three or five years. Debt may be eliminated under Chapter 13, as well.
Claim
A creditor's assertion that a particular debt should not be included as part of a bankruptcy petition.
Confirmation
The bankruptcy judge's approval of a debt elimination or reorganization in a bankruptcy petition.
Consumer Debtor, Consumer Debts
A debtor whose debts are primarily consumer debts.
Contingent Claim
A claim that may be owed by the debtor under certain circumstances, e.g., where the debtor is a co-signer on another person's loan and that person fails to pay.
Creditor
The party to whom debt is owed.
Credit Counseling, Debtor Education
A consumer debt and financial management class generally required for individuals and/or parties, prior to the discharge or reorganization of debts in a Chapter 7 or Chapter 13 bankruptcy.
Creditors' Meeting, 341 Meeting
The meeting of creditors required by section 341 of the Bankruptcy Code. The debtor will be questioned under oath regarding the estate of debt and finances.
Current Monthly Income
The average monthly income received by the debtor over the six calendar months before commencement of the bankruptcy case. Often referred to as the 6-month look back.
Debtor
The party who has filed the bankruptcy petition.
A release from debt, per provisions of the U.S. Bankruptcy Code.
Dischargeable Debt, Non-Dischargeable Debt
A debt for which the Bankruptcy Code allows the debtor's personal liability to be eliminated. Debts which may not be discharged, such as student loans, are considered non-dischargeable debt and may not be eliminated under Chapter 7 bankruptcy.
Equity
The actual share of financial value a bankruptcy petitioner owns in a property listed as debt.
Property that the U.S. Bankruptcy Code allows the debtor to exclude from liquidation in a Chapter 7 or Chapter 13 petition.
Joint Administration, Joint Petition
A bankruptcy petition allowing two or more petitions to be administered together. A husband and wife may file together under this type of petition and administration.
The right of a creditor to assume control of a debtor's property until the debt related to the property has been satisfied in full or legal arrangements have been made to satisfy the creditor's needs.
Liquidation, Liquidation Claim
A sale of a debtor's property, which the creditor may collect to satisfy a claim.
Means Test, Presumption of Abuse
A formula including inputting assets, debts and income to determine whether the ratio of debt to income qualifies the petitioner for Chapter 7 bankruptcy.
No-Asset Case
A Chapter 7 petition in which the petitioner lists no assets to satisfy any portion of the creditors' claims.
Objection to Dischargeability, Objections to Exemptions
Creditors may file a formal petition objecting to a discharged debt or exemption allowed by the bankruptcy judge.
A court-supervised debt repayment plan required as part of a Chapter 13 or Chapter 11 debt restructuring petition. The plan is usually restricted to a three- or five-year repayment period. See also Confirmation.
Plaintiff
The party who files a formal complaint with the court.
Post-Petition Transfer
A transfer of the debtor's property, completed only after confirmation of the bankruptcy.
Preferential Debt Payment
The petitioner may work out a special arrangement to repay all or part of a debt during a 90-day period prior to filing bankruptcy. Typically, the creditor accepts special terms for a reduced repayment amount in exchange for exemption from the list of debts.
Priority, Priority Claim
The Bankruptcy Code's statutory ranking of unsecured claims that determine the order in which debts will be paid.
Reaffirmation Agreement
An agreement by a Chapter 7 debtor to continue paying a dischargeable debt, typically regarding a home mortgage and a car payment.
Schedules
List of the petitioner's assets, liabilities and other financial information.
Secured Creditor, Secured Debt
A bank or financial institution issuing a loan that holds ownership of the purchased property as collateral for repayment. Any loan requiring collateral attached to repayment is known as secured debt. Car loans are the most common type of secured loan.
Statement of Financial Affairs
Questions a petitioner must answer in writing concerning sources of income and assets.
Statement of Intention
A declaration made by a Chapter 7 petitioner to answer questions regarding handling consumer debts that are secured by property of the estate.
Trustee
The representative of the bankruptcy estate who exercises statutory powers over the bankruptcy petition and discharge.
Unliquidated Claim
A claim for which a specific value has not been determined.
Unscheduled Debt
A debt not listed on the schedule. It is up to the discretion of the bankruptcy judge whether any unscheduled debts may be discharged.
Unsecured Claim
A debt for which a creditor holds no special assurance of payment. Credit card debt is a typical example of unsecured debt.
Voluntary Transfer
A transfer of a debtor's property with the debtor's consent.
Free Consultation · No Obligation · Serving the Gulf Coast · Toll Free 888-325-7602 | 800-438-9121
Learn more about bankruptcy terms and definitions. Call an experienced Florida bankruptcy attorney at The Golden Law Group. We are ready to answer all of your questions about bankruptcy, debt relief and illegal collections practices.
From three convenient office locations, we represent individuals, families and business owners in bankruptcy matters in Bradenton, Brandon, Sarasota, Tampa and communities throughout the Florida Gulf Coast region. If you are over your head in debt and don't know where to turn for relief, turn to us. Contact us today for a free, no-obligation consultation.
