341 meeting
The meeting of creditors required by section 341 of the Bankruptcy Code at which the consumer is questioned under oath by creditors, a trustee, examiner, or the U.S. trustee about his/her financial affairs. Also called creditors' meeting.
A | B | C | D | E | F | G | H | I | J | K | L | M | N | O | P | Q | R | S | T | U | V
A
adversary proceeding
A lawsuit arising in or related to a bankruptcy case that is commenced by filing a complaint with the court.
automatic stay
An injunction that automatically stops lawsuits, foreclosures, garnishments, and all collection activity against the consumer the moment a bankruptcy petition is filed.
B
bankruptcy
A legal procedure for dealing with debt problems of individuals and businesses.
Bankruptcy Code
The informal name for title 11 of the United States Code , the federal bankruptcy law.
bankruptcy court
The bankruptcy judges in regular active service in each district; a unit of the district court.
bankruptcy estate
All legal or equitable interests of the consumer in property at the time of the bankruptcy filing. (The estate includes all property in which the consumer has an interest, even if it is owned or held by another person.)
bankruptcy judge
A judicial officer of the United States district court who is the court official with decision-making power over federal bankruptcy cases.
bankruptcy petition
The document filed by the individual that begins the bankruptcy case
C
chapter 7
The chapter of the Bankruptcy Code providing for "liquidation,"(i.e., the sale of a consumer's nonexempt property and the distribution of the proceeds to creditors.)
chapter 13
The chapter of the Bankruptcy Code providing for adjustment of debts of an individual with regular income. (Chapter 13 allows a consumer to keep property and pay debts over time, usually three to five years.)
claim
A creditor's assertion of a right to payment from the consumer or the consumer's property.
confirmation
Bankruptcy judge's approval of a payment plan in chapter 13.
consumer
We avoid using the term "debtor." You can find out why here. In our use, a consumer is any individual citizen who is seeking assistance with debt.
consumer debts
Debts incurred for personal needs. These cannot be debts incurred for business needs.
contested matter
Those matters, other than objections to claims, that are disputed but are not within the definition of adversary proceeding.
creditor
One to whom the consumer owes money or who claims to be owed money by the consumer.
credit counseling
Generally refers to two events in individual bankruptcy cases: (1) the "individual or group briefing" from a nonprofit budget and credit counseling agency that individual consumers must attend prior to filing under any chapter of the Bankruptcy Code; and (2) the "instructional course in personal financial management" in chapters 7 and 13 that an individual consumer must complete before a discharge is entered. There are exceptions to both requirements for certain categories of consumers, exigent circumstances, or if the U.S. trustee or bankruptcy administrator have determined that there are insufficient approved credit counseling agencies available to provide the necessary counseling.
creditors' meeting
This is the "meeting of the creditors" and is also known as the 341 meeting
current monthly income
The average monthly income received by the consumer over the six calendar months before filing of the bankruptcy case, including regular contributions to household expenses from other individuals and income from the consumer's spouse if the petition is a joint petition. This does not include social security income and certain other payments made because the consumer is the victim of certain crimes.
D
debtor
A person who has filed a petition for relief under the Bankruptcy Code. We do not like to use this term. We explain why here.
defendant
An individual (or business) against whom a lawsuit is filed.
discharge
A release of a consumer from personal liability for certain dischargeable debts set forth in the Bankruptcy Code. A discharge releases a consumer from personal liability for certain debts and prevents the creditors owed those debts from taking any action against the consumer to collect the debts. The discharge also prohibits creditors from communicating with the consumer regarding the debt, including telephone calls, letters, and personal contact.
dischargeable debt
A debt for which the Bankruptcy Code allows the consumer's personal liability to be eliminated.
E
equity
The value of a consumer's interest in property that remains after liens and other creditors' interests are considered. (Example: If a house valued at $100,000 is subject to a $80,000 mortgage, there is $20,000 of equity.)
exemptions, exempt property
Certain property owned by an individual consumer that the Bankruptcy Code or applicable state law permits the consumer to keep from unsecured creditors. The availability and amount of property the consumer may exempt depends on the state the consumer lives in.
I
insider (of individual consumer)
Any relative of the consumer or of a general partner of the consumer; partnership in which the consumer is a general partner; general partner of the consumer; or a corporation of which the consumer is a director, officer, or person in control.
J
joint petition
One bankruptcy petition filed by a husband and wife together.
L
lien
The right to take and hold or sell the property of a consumer as security or payment for a debt or duty. Common liens include automobile loans, mortgages, and mechanic's liens.
liquidation
A sale of a consumer's property with the proceeds to be used for the benefit of creditors.
liquidated claim
A creditor's claim for a fixed amount of money.
M
means test
Section 707(b)(2) of the Bankruptcy Code applies a "means test" to determine whether an individual consumer's chapter 7 filing is presumed to be an abuse of the Bankruptcy Code. Abusive filings are either dismissed or converted to Chapter 13 cases (with the consumer's consent.) If a consumer fails the means test, other factors are considered to determine whether the filing is abusive. The consumer may rebut a presumption of abuse only by a showing of special circumstances that justify additional expenses or adjustments of current monthly income.
motion to lift the automatic stay
A request by a creditor to allow the creditor to take action against the consumer or the consumer's property that would otherwise be prohibited by the automatic stay.
N
no-asset case
A chapter 7 case where there are no assets available to satisfy any portion of the creditors' unsecured claims.
nondischargeable debt
A debt that cannot be eliminated in bankruptcy. Examples include a home mortgage, debts for alimony or child support, certain taxes, debts for most government funded or guaranteed educational loans or benefit overpayments, debts arising from death or personal injury caused by driving while intoxicated or under the influence of drugs, and debts for restitution or a criminal fine included in a sentence on the consumer's conviction of a crime.
O
objection to dischargeability
A trustee's or creditor's objection to the consumer being released from personal liability for certain dischargeable debts. Common reasons include allegations that the debt to be discharged was incurred by false pretenses or that debt arose because of the consumer's fraud while acting as a fiduciary.
objection to exemptions
A trustee's or creditor's objection to the consumer's attempt to claim certain property as exempt from liquidation by the trustee to creditors.
P
party in interest
A party who has standing to be heard by the court in a matter to be decided in the bankruptcy case. The consumer, the U.S. trustee or bankruptcy administrator, the case trustee and creditors are parties in interest for most matters.
plan
A consumer's detailed description of how the consumer proposes to pay creditors' claims over a fixed period of time. In an consumer context, these are used in Chapter 13 filings.
plaintiff
A person or business that files a formal complaint with the court.
postpetition transfer
A transfer of the consumer's property made after the commencement of the case.
preference or preferential debt payment
A debt payment made to a creditor in the 90-day period before a consumer files bankruptcy (or within one year if the creditor was an insider) that gives the creditor more than the creditor would receive in the consumer's chapter 7 case.
presumption of abuse
see means test
priority
The Bankruptcy Code's statutory ranking of unsecured claims that determines the order in which unsecured claims will be paid if there is not enough money to pay all unsecured claims in full.
priority claim
An unsecured claim that is entitled to be paid ahead of other unsecured claims that are not entitled to priority status. Priority refers to the order in which these unsecured claims are to be paid.
proof of claim
A written statement and verifying documentation filed by a creditor that describes the reason the consumer owes the creditor money.
property of the estate
All legal or equitable interests of the consumer in property as of the commencement of the case.
R
reaffirmation agreement
An agreement by a chapter 7 consumer 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.
S
schedules
Detailed lists filed by the consumer along with the petition showing the consumer's assets, liabilities, and other financial information.
secured creditor
A creditor holding a claim against the consumer who has the right to take and hold or sell certain property of the consumer in satisfaction of some or all of the claim. The holder of your home mortgage or auto loan are examples of two types of secured creditors.
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.
statement of financial affairs
A series of questions the consumer must answer in writing concerning sources of income, transfers of property, lawsuits by creditors, etc. (There is an official form a consumer must use.)
statement of intention
A declaration made by a chapter 7 consumer concerning plans for dealing with consumer debts that are secured by property of the estate. This generally involves whether the consumer wants to reaffirm specific debts.
T
transfer
Any mode or means by which a consumer disposes of or parts with his/her property.
trustee
The trustee is a private individual or corporation appointed in all chapter 7, chapter 12, and chapter 13 cases and some chapter 11 cases. The trustee's responsibilities include reviewing the consumer's petition and schedules and bringing actions against creditors or the consumer to recover property of the bankruptcy estate. In chapter 7, the trustee liquidates property of the estate, and makes distributions to creditors. Trustees in chapter 13 have similar duties to a chapter 7 trustee and the additional responsibilities of overseeing the consumer's plan, receiving payments from consumers, and disbursing plan payments to creditors.
U
U.S. trustee
An officer of the Justice Department responsible for supervising the administration of bankruptcy cases, estates, and trustees; monitoring plans and disclosure statements; monitoring creditors' committees; monitoring fee applications; and performing other statutory duties.
undersecured claim
A debt secured by property that is worth less than the full amount of the debt. If your mortgage is for $600,000 and your home is only worth $400,000, the claim is unsecured.
unliquidated claim
A claim for which a specific value has not been determined.
unscheduled debt
A debt that should have been listed by the consumer 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. This is credit which was extended based solely upon the creditor's assessment of the consumer's future ability to pay. One primary example would be credit card debt.
V
Voluntary transfer
A transfer of a consumer's property with the consumer's consent.
