What Can You Do If A Creditor Files A Proof Of Claim In Your Bankruptcy Case?

Posted on: 23 March 2015


After you file for bankruptcy, all of your creditors will be notified. Your creditors can challenge the discharge of a debt, which triggers an investigation by the bankruptcy trustee. If this happens, it is important that you know what to do. 

What Is a Proof of Claim?

A proof of claim is a creditor's statement that states it is entitled to receive payment of the debt that is owed. Unsecured creditors have to file a proof of claim in order for the debt to stand after the bankruptcy. Unsecured debts are those which do not have collateral tied to them, such as a medical or telephone bill. 

Most secured debts do not require a proof of claim. A secured debt involves collateral, such your home or car. These debts are usually automatically included in the bankruptcy. 

Can You Object to a Proof of Claim?

A proof of claim is not automatically validated. In order for the debt to stand, the creditor has to show proof that the debt is valid and should be paid. It is on the creditor to prove this. 

You can object to the proof of claim under certain conditions. For instance, if the creditor did not provide documentation that supported the validity of the claim, you can object. Other situations under which you can object include:

  • The amount the creditor is claiming is incorrect
  • The creditor has filed the claim before
  • The name listed on the claim is incorrect
  • The interest fees are incorrect

There are other situations in which you can object. Talk to a bankruptcy attorney to help you determine whether or not a claim is valid.

How Do You Object?

An objection to the creditor's proof of claim has to be written and submitted to the bankruptcy court. After the court receives the objection, a copy of it will be sent to the creditor and the trustee for review. 

What happens next depends on the actions of the creditor. If the creditor does not respond in the time allotted by the court, the objection will stand and you will not be liable for the debt.

However, if the creditor does respond, your case will head to bankruptcy court. A judge will listen to evidence from both you and the creditor and determine whether or not the debt should stand. 

To ensure that you get the most out of the bankruptcy process, you should work with an experienced attorney. When situations arise, such as a proof of claim, your attorney can guide you on how to proceed and ensure you are legally protected.