The following legal terms are commonly used in bankruptcy proceedings.
A lawsuit in or related to a bankruptcy case that is commenced by filing a complaint with the court. A nonexclusive list of adversary proceedings is set forth in Federal Rule of Bankruptcy Procedure 7001.
- Asset or No Asset Cases
An asset case is one in which money is recovered to make a distribution to a class of unsecured creditors over and above the costs of administration and the debtor’s exemptions. A no asset case is one in which there is no money to distribute to unsecured creditors.
- Automatic Stay
An injunction that automatically stops lawsuits, foreclosures, garnishments, and collection activity against the debtor the moment a bankruptcy petition is filed.
- Bankruptcy Code
The informal name for title 11 of the United States Code (11 U.S.C. Sections 101-1330), the federal bankruptcy law.
- Bankruptcy Estate
All legal or equitable interests of the debtor in property at the time of the bankruptcy filing. The estate includes all property in which the debtor has an interest, even if it is owned or held by another person.
- Bankruptcy Petition
The document filed by the debtor (in a voluntary case) or by creditors (in an involuntary case) which opens the bankruptcy case. There are official forms for bankruptcy petitions.
A creditor’s assertion of a right to payment from the debtor or the debtor’s property.
Bankruptcy judges’s approval of a plan of reorganization or liquidation in chapter 11, or payment plan in chapter 12 or 13.
One to whom the debtor owes money or who claims to be owed money by the debtor.
- Creditor Matrix
A separate list of all creditors and their representatives with their full addresses. The court uses this list to mail notices to all the debtor’s creditors.
- Creditor's Meeting (also known as 341 Meeting)
The meeting of creditors required by Section 341 of the Bankruptcy Code at which the debtor is questioned under oath by creditors, a trustee, examiner, or the U.S. trustee about his/her financial affairs.
An individual (or business) against whom a lawsuit is filed.
A release of the debtor from personal liability for certain dischargeable debts set forth in the Bankruptcy Code, and prevents the creditors owed those debts from taking any action against the debtor to collect the debts.
A dismissal is an order or judgment terminating a motion, adversary proceeding, or bankruptcy case.
- Exemptions, exempt property
Certain property owned by an individual debtor that the Bankruptcy Code or applicable state law permits the debtor to keep from unsecured creditors. The availability and amount of property the debtor may exempt depends on the state that the debtor lives in.
- Joint Petition
One bankruptcy petition filed by a husband and wife together.
A motion is a formal request made to a judge for an order or judgment. See Local Rule 9014 for more information.
- Motion to Lift Automatic Stay
A request by a creditor to allow the creditor to take action against the debtor or the debtor’s property that would otherwise be prohibited by the automatic stay.
A person or business that file a formal complaint with the court.
- Proof of Claim
A written statement and verifying documentation filed by a creditor that describes the reason the debtor owes the creditor money.
- Pro Se
A person appearing without representation by an attorney for himself; on his own behalf.
- Reaffirmation Agreement
An agreement by a chapter 7 debtor to continue paying a dischargeable debt (such as an auto loan) after the bankruptcy, usually for the purpose of keeping collateral (i.e. the car) that would otherwise be subject to repossession.
Detailed lists filed by the debtor along with, or shortly after filing, the petition showing the debtor’s assets, liabilities, and other financial information. There are official forms a debtor must use.
- Secured Debt
Debt backed by a mortgage, pledge of collateral, or other lien; debt for which the creditor has the right to pursue specific pledged property upon default. Examples include home mortgages, auto loans, and tax liens.
The representative of the bankruptcy estate who exercises statutory powers, principally for the benefit of unsecured creditors, under the general supervision of the court and direct supervision of the U.S. trustee or bankruptcy administrator. The trustee is appointed in all chapter 7, 12, and 13 cases and some chapter 11 cases. The trustee’s responsibilities include reviewing the debtor’s petition and schedules and bringing actions against creditors or the debtor to recover property of the bankruptcy estate, and makes distributions to creditors. Trustees in chapter 12 and 13 cases have similar duties to a chapter 7 trustee and the additional responsibilities of overseeing the debtor’s plan, receiving payments from debtors, and disbursing plan payments to creditors.
- U.S. Trustee
An officer of the Justice Department responsible for supervising the administration of bankruptcy cases, estates, and trustees; monitoring fee applications; and performing other statutory duties.
- Unscheduled Debt
A debt that should have been listed by the debtor in the schedules filed with the court but was not. Depending on the circumstances, an unscheduled debt may or may not be discharged.
- Unsecured Claim
A claim or debt for which a creditor holds no special assurance of payment; a debt for which credit was extended based solely upon the creditor’s assessment of the debtor’s future ability to pay.