Commonly encountered bankruptcy terms for the individual

When a Mississippi resident is considering filing for bankruptcy, they are sometimes overwhelming by the legal jargon and financial lingo with which they are unfamiliar. By getting acquainted with some of the most common personal bankruptcy terms, anyone who is considering filing for bankruptcy may feel a bit more confident in approaching the process.

First and foremost is the definition of bankruptcy itself. While most residents realize bankruptcy is a way to discharge or restructure debt and thus obtain debt relief, specifically bankruptcy is a case filed under Title 11 of the U.S. Code, also known as the bankruptcy code. The bankruptcy estate consists of the entirety of a debtor's legal or equitable interests when that person files for bankruptcy. This generally is composed of personal property, but can also involve property owned by others in which the debtor has an interest.

The bankruptcy petition is the document which formally opens up a new bankruptcy case. The petition can be filed voluntarily by a debtor or it can be filed, in some cases, by a debtor's creditors. Chapter 7 and Chapter 13 are both chapters of the U.S. Bankruptcy Code relating to individual or personal bankruptcy. The first concerns debt liquidation and the second entails debt reorganization. Chapters 9, 11 and 12 relate to municipalities, certain businesses and farming or fishing operations, respectively.

A claim is the assertion of the creditor that it has a right to payment from the debtor or the debtor's property. The proof of claim is the documentation and written statement that a creditor files for the purpose of outlining the reason why the debtor owes the creditor. A schedule is the detailed listing of assets and liabilities which the debtor provides either with the filing or shortly after filing for bankruptcy. An unscheduled debt, therefore, is a debt that should have been included in the listing of other debts but was not.

These are countless additional bankruptcy-related terms that individuals may encounter as they prepare to file. Getting more information can clear up any questions related to understanding bankruptcy, its legal terms and how it benefits the individual debtor.

Source: UScourts.gov, "Glossary," accessed Dec. 21, 2014

No Comments

Leave a comment
Comment Information

Office Location

7160 Tchulahoma Road Suite A5
Southhaven, MS 38671

Toll Free: 888-341-8136
Phone: 662-655-1605
Fax: 866-267-5360
Southhaven Law Office Map

Review Us

REACH US BY PHONE