Proof of Claim in Chapter 7

In Chapter 7 bankruptcy cases, a creditor must file a “Proof of Claim” (PoC) in which it states: how much you, the debtor, owe to the creditor; why the creditor is owed this amount; and whether this debt is secured by “property of the Estate.” PoCs are also supported by documentation such as copies of Judgment Orders and calculations of debts owed.A creditor’s PoC generally represents what it may earn from the debtor, assuming the debtor will be able to pay the Creditor’s Claim; however, most debtors do not have sufficient assets to liquidate in order to pay this claim, which then results in a “No Asset” finding.If you believe a creditor has filed an inflated, exaggerated, or otherwise false claim, you may file an “Objection to Proof of Claim” to dispute it and require the creditor to provide supporting evidence in defense. A creditor may lose its claim altogether if it is determined that a false or exaggerated claim is made against a debtor. Time-limits can be strict for filing both PoCs and formal Objections, so make sure you are aware of these deadlines at all times.If you are struggling financially and considering filing for Chapter 7 bankruptcy, you’re not alone. Contact an experienced bankruptcy attorney today for a free consultation.