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    Bankruptcy Terms

    Below you will find various bankruptcy terms and an explanation of each term.  The Law Offices of Kristy Qiu, P.A. is committed to assisting individuals in the Ft. Lauderdale area that are in bankruptcy proceedings or are considering filing bankruptcy. Our firm will work closely with you to determine the best path to take and can provide personalized legal counsel, support, and representation in chapter 7, chapter 11, and chapter 13 filings.

    There are some very significant differences between the three different bankruptcy chapters and it is crucial for any individual in financial trouble to consult the expertise of a professional Ft. Lauderdale bankruptcy lawyer who can provide valuable insight and guidance into the process.

    Adversary Proceeding: A lawsuit arising 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 Rules of Bankruptcy Procedure Section 7001.

    Arrearage: The state of being behind in the fulfillment of obligation or being over due in payment; a payment owed.  For example, if your mortgage payment is $3,000 per month and you are 3 months behind, you are $9,000 in arrears.

    Assets: Property owned by a person. This includes tangibles such as real estate, cars, and jewelry, and intangibles, such as business goodwill, the right to sue someone, stock, options, or future interests in a will.

    Assume or Assumption: The act of taking to or upon oneself.

    Automatic Stay: An injunction under the Bankruptcy code prohibiting creditors from beginning or continuing proceedings for collecting owed amounts from the person or entity filing for bankruptcy. It goes into effect automatically and immediately upon filing for bankruptcy. It also stops lawsuits, foreclosures, garnishments, and all collection activity against the debtor.

    Avoidance: The ability to remove a lien.  The bankruptcy code allows certain types of liens to be avoided, such as judgment liens if they impair an exemption claimed in the bankruptcy case.

    Avoidance Powers: Power of the Trustee under the Bankruptcy Code to recover certain transfers of property such as preferences or fraudulent transfers, or to void liens created prior to filing a bankruptcy case.

    Bankruptcy Court: A division of the United States District Courts with exclusive and original jurisdiction for cases filed under the Bankruptcy Code (Title 11 of the United States Code). It also has nonexclusive jurisdiction to hear civil proceedings arising under the Bankruptcy Code.

    Bankruptcy Estate: The legal, fictional entity that comes into being when one files bankruptcy. It is composed of all the (non-exempt) assets (tangible and/or intangible) that you have to surrender to the Trustee for liquidation upon filing for bankruptcy.

    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 Judges are appointed for a term of 14 years.

    Bankruptcy Petition: The document filed by the debtor (in a voluntary case) or by creditors (in an involuntary case) in which the person asks the court to open a bankruptcy case. Unlike traditional legal petitions, bankruptcy petitions are standard fillable forms provided by the court.

    Business Bankruptcy: A case in which the majority of the total debts owed are business-related.

    Chapter 7: The chapter of the Bankruptcy Code providing for “liquidation,” the selling of all of the debtor’s non-exempt assets and the distribution of proceeds to the creditors.

    Chapter 9: The chapter of the Bankruptcy Code providing for reorganization of municipalities such as cities and towns, villages, counties, tax districts, municipal utilities, water districts, and school districts.

    Chapter 11: The chapter of the Bankruptcy Code providing for business (corporations, partnerships, etc.) reorganization. It also provides for  reorganization of individual debtors owing more than $360,475 in noncontigent, liquidated and unsecure debts, and $1,081,400 in noncontigent, liquidated and secured debts.

    Chapter 12: The chapter of the Bankruptcy Code providing for adjustment of debts of family farmers and family fishermen.

    Chapter 13: The chapter of the Bankruptcy Code providing for adjustment of debts of individuals with debts less than $360,475 in noncontigent, liquidated and unsecure debts, and $1,081,400 in noncontigent, liquidated and secured debts who earn a regular monthly income. Chapter 13 allows debtors to keep property and repay debts over time, usually 36 to 60 months.

    Chapter 15: The chapter of the Bankruptcy Code that deals with cross-border insolvencies.

    Claim: A creditor’s assertion of a right to payment from the debtor or security against debtor’s property.

    Confirmation: Bankruptcy judge’s approval of a reorganization or a liquidation plan in Chapter 11, or a payment plan in chapter 12 or 13.

    Consumer Bankruptcy: A case in which the debtor is an individual whose debts are primarily consumer debts.

    Consumer Debts: Debts incurred for personal needs.

    Contested Matter: Disputed matters and claims that do not amount to adversary proceedings.

    Contingent Claim: Claims that depend on the occurrence of future events.

    Creditor: One to whom the debtor owes money.

    Creditors’ Meeting: Also known as 341 meeting. It’s a meeting set up the Trustee. The purpose of the meeting is to ensure that the debtor has fairly and honestly represented his/her assets, income and debts in his/her bankruptcy filing. The Trustee can ask questions, under oath, concerning all of the debtor’s property and debtor’s financial situation. Creditors and security lien holders may show up and ask questions as well. Debtors will not be asked to justify filing bankruptcy. Debtors must attend the meeting or their cases will be dismissed. The court will not and may not take part or attend the meeting.

    Current Monthly Income: Average monthly income from all sources that you receive during the six-month period ending on the last day of the calendar month preceding your bankruptcy petition date. It does not matter whether the income is taxable, regular payments made by another entity to you for household expenses, contributions to living expenses m