Protecting the Rights of Creditors and Reclaiming Debt
The media loves to portray the creditor as the bad guy — greedy misers, mercilessly bullying the little guys they take advantage of, using phone calls and tough-guy tactics to collect money the little guy doesn’t have and shouldn’t have to pay back.
Even reality seems to favor the debtor, as an entire agency has been created to protect them, and rules have been put in place specifically targeting collectors. But that’s only one side of the story. Businesses lend credit as a sign of trust that an individual will pay for the product or services they’ve used, and, especially for small businesses, when that money isn’t repaid, it affects any company’s bottom line.
As a creditor, you may be forced to combat overdue consumer debt and pending bankruptcy proceedings. Recovering funds is essential to protecting your business’s livelihood, and Bunch & Brock have the experience you need to reclaim the money you’re owed.
Let Bunch & Brock Help
At the offices of Bunch & Brock, Attorneys at Law, in Lexington, Kentucky, we offer powerful protection of creditors’ rights backed by more than 30 years of experience. Attorneys at our firm represent companies and corporations in matters ranging from securing preference claims and gathering collateral to litigation proceedings. To arrange a consultation with a lawyer skilled in protecting creditors’ rights, contact us online or call us at 859-254-5522.
- Collecting Debt: Creditors have several avenues for collecting what they are owed, but each depends on the level of debt and the debtor’s willingness to pay. Most remedies simply involve direct contact, but more difficult cases may involve the court system.
- Contact the Debtor: Many times, the only action necessary is a phone call. In this case the debtor simply needs to be informed that the debt is overdue.
- Collection Agency: If the debtor still does not pay, another option is a debt collection agency – a business which, for a percentage of the debt, will pursue the debt for you. These agencies are bound by the Fair Debt Collection Practices Act, meaning there are specific federal guidelines they must follow in pursuit of the debt.
- Repossession: If the loan is for property, for instance a car or furniture, the physical items may be repossessed. Before repossession may take place, there often must be court hearings and orders, but these are waived if the property is in danger of being damaged or destroyed.
- Courts: If all other tactics fail, then it is possible to sue for money owed. The court sometimes awards the creditor a portion of the debtor’s property in order to pay off the debt. If the debtor owes enough money to enough creditors, then the creditors may ultimately pursue an involuntary bankruptcy.
Types of Bankruptcy
If a debtor has declared bankruptcy, repayment often depends on the type of bankruptcy the debtor has filed. The two most common types of bankruptcy are:
Chapter 7: In Chapter 7 bankruptcy, a debtor’s property is liquidated and sold in order to pay off accumulated debt. While there are exemptions to what property can be liquidated, the court will generally repay creditors based on the criteria of the loans and money owed.
Chapter 13: In Chapter 13, a debtor is given a specific amount of time to formulate a plan to restructure, and, in the process, their loans may be renegotiated or forgiven. Depending on the plan, creditors may often expect full repayment, but it may be at a delayed time.
Types of Claims
In the event that a debtor is taken to court or initiates bankruptcy proceedings, the courts often list priorities as to who will be repaid first. Part of that depends on the type of debt.
Secured claims are those based on agreements that often involve collateral or a deed of trust, including mortgages, car loans or other types of larger loans. A court may put a lien on property if the debt is not paid, meaning it cannot be sold until the debt is repaid or, in the case of a lien, that the creditor receives the lesser of the collateral or debt.
Establishing Preference Claims
U.S. bankruptcy laws allow specific creditors to receive payments before others do during a bankruptcy. Securing a preference claim (also known as a preference action) can allow you to recover and retain the payment you are entitled to before funds run out. Our firm diligently prepares necessary preference claim paperwork and aggressively negotiates or litigates on your behalf.
Pursuing Bankruptcy Litigation
Because of the different criteria used when courts allocate repayment or when simply trying to collect an induvial debt, the help of a law firm is often indispensable in making sure you receive the debt you are owed. Bunch & Brock’s focus when representing creditors’ rights is to help you receive the money you are owed in the most effective and efficient manner possible. When negotiation techniques are not enough, we do not hesitate to bring a matter before the courts.
Lawyers at our firm are prepared to assist you with bankruptcy litigation matters involving:
- Relief from stay: challenging automatic stays granted to debtors
- Adversary proceedings: arguing the discharge of certain debts
- Lien avoidance: challenging a debtor’s attempts to remove liens
- Bankruptcy reclamation: collecting property sold to a debtor
- Fraudulent conveyance: pre-file transfers made with intent to defraud.
Protect Your Rights — Contact Bunch & Brock
The bankruptcy code provides significant protection to creditors dealing with unpaid debts. Bunch & Brock can help you understand how to fully protect your rights during bankruptcy proceedings. With over three decades of experience litigating from offices in Lexington, the attorneys of Bunch & Brock are familiar with Kentucky law; we have the knowledge, experience and resources to help you receive the full repayment you deserve. If you have any questions or would like to set up a consultation, contact us online or call us at 859.254.5522.
Protect Your Rights — Contact Bunch & Brock
The bankruptcy code provides significant protection to creditors dealing with unpaid debts. Bunch & Brock can help you understand how to fully protect your rights during bankruptcy proceedings. To arrange a consultation, contact us by telephone or online.