A bankruptcy proof of claim is a form creditors must file to provide the court with information regarding your debt. If a creditor fails to file a proof of claim in your chapter 7 or Chapter 13 bankruptcy case, it will not get paid even if the bankruptcy trustee makes a distribution to creditors. Read on to learn more about proofs of claim in bankruptcy.
For more information, visit our topic area on The Proof of Claim in Bankruptcy.
What Is a Bankruptcy Proof of Claim?
A proof of claim is a form creditors must file in bankruptcy to provide information to the court about their claims. The trustee will use the information on the proof of claim to determine whether the creditor has a valid claim and where to send payment if there is a distribution. This means that if a creditor doesn’t file a proof of claim, it will not get paid in your bankruptcy.
Who Is Allowed to File a Bankruptcy Proof of Claim?
It’s typically the creditor’s responsibility to file its own proof of claim with the court. But if the creditor doesn’t file a claim, the debtor can also file one on its behalf. While debtors rarely file claims on behalf of their creditors, sometimes it can be in their best interest.
Example. Dan was laid off from his job and fell six months behind on his mortgage payments. He recently found another job but the mortgage company was not willing to allow him additional time to cure his default. Dan filed for Chapter 13 bankruptcy to catch up on his missed payments through a bankruptcy repayment plan and save his house. If Dan’s mortgage lender doesn’t file a proof of claim, the trustee can’t make the necessary payments for Dan to catch up on his mortgage. In fact, the trustee will likely ask the court to pay Dan’s monthly payments to his unsecured creditors (such as credit card companies) who have filed claims. In this case, it would be in Dan’s best interest to file the claim on behalf of his mortgage lender.
To learn more about when it makes sense to file a claim for a creditor, see Filing a Proof of Claim for a Creditor in Bankruptcy.
When Must Creditors File Their Proofs of Claim?
Most creditors have 90 days from the original scheduled date of your meeting of creditors (also called the 341 hearing) to file their proofs of claim. But if the creditor is a government entity, it has 180 days from when your case is filed.
What Information Must the Proof of Claim Provide?
In most cases, a bankruptcy proof of claim must have:
- the bankruptcy case number
- the debtor’s name
- the name of the creditor holding the claim
- the address where the creditor wants to receive notice and payment
- the amount of the claim when the case was filed
- the type of claim the creditor has (such as secured, unsecured, or priority), and
- supporting information and documentation to prove that the claim is valid.
What Can You Do If You Disagree With a Creditor’s Proof of Claim?
When a creditor files its proof of claim, you have the opportunity to review the claim and determine whether it’s accurate. If you disagree with the information on the proof of claim, you can object to the claim and ask the court to disallow it.
The following are some of the most common reasons you might object to a proof of claim:
- the amount or type of claim is incorrect
- the creditor filed the proof of claim after the deadline to file claims expired, and
- the creditor failed to attach any supporting documentation to its claim.
For more information on what steps you must take to object to a proof of claim, see How to Object to a Creditor’s Proof of Claim.
Creditors Might Not File a Proof of Claim in a No-Asset Chapter 7 Bankruptcy
If you file a no-asset Chapter 7 bankruptcy (meaning you don't have any nonexempt property that the trustee can sell to pay your creditors), most creditors will not bother to file a proof of claim. Because the trustee will not distribute any money or property to your creditors, they will typically not have any incentive to file a claim in your case. So don't be surprised if many of your creditors don't file a proof of claim in your no-asset Chapter 7 bankruptcy.