Filing for bankruptcy means filing tons of documents before the process is completed. Among these documents are claims or debts collected. Claims come in different types including a liquidated claim.
What is Liquidated Claim?
A liquidated claim is the amount agreed by the debtor and creditor that must be paid. An example of this is writing a promissory note for a fixed amount. The good thing about this claim is that a simple computation can draw the value to settle. Some claims’ values are difficult to determine due to inconsistent filing or unawareness of what they actually owe.
What Claims Fall Under this Category?
There are many reasons why a claim may fall in this category, but the keyword is every value is fixed and indisputable. Good examples of liquidated claims are the price of materials, services, products or hourly rates that are indicated with fixed prices. As long as these values didn’t get any objection from a creditor, then they fall under liquidated claim.
How to List Claims?
Listing a claim is the most challenging among many debtors. They do not know whether they are writing them correctly or not. Most of the time, they do not know how much they actually owe a creditor. One of the rules in writing claims is by using supporting documents in writing. A good example is a lien. Some creditors attach liens on different assets. If there’s a lien, use the value indicated in the lien to ensure it will be in black and white.
In case there is some inconsistency with the listed claims, the creditors will definitely inform the trustees and debtors that the claim is objected to.
Why Creditors Object Claims?
There are many reasons why a creditor may object claims. A common reason is the technicality surrounding the claim. For example, a claim should not be listed as a liquidated claim, the amount listed is not what the other party agrees to, and claims for defective solutions. There are still other reasons, but objections can be resolved with the help of creditors.
What will Happen to Objected Claims?
If objected, both parties need to bring the case to a bankruptcy court. Both debtors and creditors will discuss arrangements or other solutions to come up with the actual value to claim. A hearing may be conducted for both parties to arrive to an agreement. The good thing is that it is possible for debtors to ask their trustees about the probability of having a court date to discuss the objected claims. Once both parties arrived to an agreement, debtors will continue with the next process of bankruptcy filing process.
The aforementioned details will give you an idea what this claim is. Other details can be discussed with a bankruptcy trustee to know the next procedures that come with bankruptcy. Be sure to work with a reputable trustee to ensure you will understand more about accurate claim listing process.