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InfoSight Highlight: Bankruptcy Rule and Forms Changes

Mon, Nov 20, 2017

The Federal rules of Bankruptcy procedures dealing with requirements and timing of a Proof of Claim is changing on December 1, 2017.

Currently Bankruptcy Rule 3002 generally requires a proof of claim in a Chapter 7,12, or Chapter 13 case to be filed no later than 90 days after the first date set for the meeting of creditors.

The new bankruptcy rule change will require a proof of claim to be filed no later than 70 days after the date the bankruptcy case is filed. This is certainly a decrease in the amount of time permitted for filing a proof of claim.

Attachments that are generally required, such as a note, mortgage or security agreement can be filed as a supplement to a credit union’s claim no later than 120 days after the date the bankruptcy is filed.

The new rules also clarify that secured creditors must file a Proof of Claim for the claim to be allowed, but the creditor’s security interest is still valid even if the creditor fails to file the proof of claim.

A credit union should receive a Notice from the Bankruptcy Court advising the credit union that the debtor has filed either a chapter 7 or a Chapter 13 bankruptcy. The notice in a chapter 13 bankruptcy will indicate the deadline for a creditor to file a proof of claim.

In a chapter 7 bankruptcy, the notice will either provide a deadline for filing a proof of claim where there are assets available to pay creditors or where there are currently no assets available to pay creditors, will indicate that a creditor should not file a proof of claim unless they receive a notice from the court to do so. If it later appears that assets are available to pay creditors the bankruptcy clerk will send another notice indicating that a creditor may file a proof of claim and the deadline for filing the claim.