Even when a debtor has declared bankruptcy, you should not assume your claim is dead in the water. Companies can declare bankruptcy under several chapters of the U.S. Bankruptcy Code, but in each case the debtor will usually end up paying some of its debts.
The bankruptcy court’s job is to ensure that any qualifying assets the debtor owns are distributed fairly to the creditors based on a system of preferences. Creditors who have debtor collateral are generally at the top of the list, along with those who have a court judgment against the debtor. Lower down are unsecured creditors, such as credit card companies.
To get in line for payment, creditors must attend what’s called a “341 creditors’ meeting” with the bankruptcy court. Yet many creditors assume they’ll get nothing and don’t even attend this meeting.
It is not in your best interest to give up your claim by ignoring the 341 meeting. Depending on the exact situation, you may be in a good position to collect the money owed to you. If it is a substantial amount, you may wish to invest in an in-depth investigation of the debtor’s assets and ability to repay. You may also need to know whether the debtor has committed fraud by paying off its favored creditors before filing for bankruptcy.
Armed with information, we can insist on your rights
Once your Kaplan & Cruz, PLLC, lawyers have learned the facts of the situation, examined the debtors financial situation and uncovered any potential fraud claims, we can attend the 341 creditors’ meeting on your behalf. We will challenge any proposed discharge or reduction in the amount you are owed. If there will be an adversarial hearing, we can argue your case in that hearing, as well.
Whether you are a Texas, out-state or international creditor, Kaplan & Cruz can pursue your debt anywhere in Texas. We are happy to provide a straightforward assessment of what you can expect.