When you file for Chapter 13 bankruptcy, your creditors must take action before they can get paid under your Chapter 13 repayment plan. The creditors must file a proof of claim, which shows how much they're owed and why. Occasionally, these claims must be amended after the initial filing due to mistakes or changes in circumstances.
What is a Proof of Claim?
When you file for Chapter 13 bankruptcy, you enter into a repayment plan that lasts three to five years. If any debts remain unpaid after you complete your plan, the court discharges them (unless they're ineligible), and you're no longer responsible for paying them.
Creditors can claim a share of your payments by submitting a proof of claim to the bankruptcy court. The claim must describe the debt you owe, including the principal balance, interest, fees and expenses assessed. It must also state whether it is a secured debt, and unsecured debt or a priority debt.
Your creditor must provide supporting documentation with its claim. This includes notes, credit agreements, mortgages, titles showing liens, judgments and anything else that shows how you came to owe the money and how much is owed.
Deadlines for Filing Claims
Creditors must submit their proofs of claim within 70 days of the date the case is filed. The deadline for filing claims, also called the claims bar date, will be listed on the bankruptcy notice and on the court's docket.
In some cases, the deadline comes up so quickly that creditors overlook certain things in the rush to file on time. Common mistakes include citing an incorrect claim amount, failure to attach supporting documentation, misuse of check boxes, improperly claimed priority status, typographical errors and incorrect case numbers.
Amendments to Claims
When creditors discover an error in their initial proof of claim, they may correct that mistake by submitting an amended proof of claim. Claims can be amended even after the deadline for filing the claim has passed, as long as the creditor filed the original claim on time. The amendment relates back to the original filing date.
Sometimes when creditors file an amended proof of claim, they fail to indicate its amended status on the claim form. When this happens, it appears that the creditor has submitted two proofs of claim to the bankruptcy court. Although this may alarm you, it's an error that can easily be corrected. If the creditor fails to bring the error to the court's attention, the debtor can object to the duplicate claim and have it stricken or simply contact the creditor and see if it will correct the issue.
- Michael Blann/Digital Vision/Getty Images