Chattanooga Bankruptcy Attorneys Clark & Washington Explain Secured, Unsecured & Priority Claims in Bankruptcy
Bankruptcy attorneys Clark & Washington explain the three types of claims and their implications during bankruptcy.
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CHATTANOOGA, TN, August 01, 2014 /24-7PressRelease/ -- The Chattanooga bankruptcy attorneys at Clark & Washington wish to inform the public of the three types of creditor claim classifications that exist during a bankruptcy. Each claim has a different effect on your assets and responds differently to bankruptcy filing.
When you are filing for bankruptcy, part of the process will require filing what is called a "schedule." The schedule is simply a list all of your real property, personal property, detailed income information, monthly expenses and other detailed information. This information is used to determine the types of debts that you may have. With this schedule, you are also asked to disclose the type of claims each of your creditors has against you. There are three types of claims: secured, unsecured and priority claims.
A creditor with a secured claim has a security interest, or a lien, on the property owned by the debtor. This security interest is often referred to as "collateral." Creditors with a secured claim against your property are typically allowed to retrieve the collateral even after you have filed for bankruptcy and your personal liability has been discharged.
Unsecured claims are claims covering more generic types of debts. For these debts, the creditor has no collateral in any debtor-owned property. Examples of unsecured claims would be credit card debt, student loans, medical bills, utility bills, personal loans and other similar debts. The Chattanooga bankruptcy attorneys note that an unsecured claim can become a secured claim at any time. All a creditor needs is a valid judgment against your and a judgment lien.
Priority claims are claims that take priority over other debts, meaning they will be paid first over other claims if a debtor has available funds or assets to be sold to collect on the debt. Common priority claims are child support, alimony and taxes. Priority claims are non-dischargeable claims, which means that filing for bankruptcy will not alleviate you of your obligation to pay these debts.
If you plan on filing for bankruptcy and have any priority claims, you should consult an experienced Chattanooga bankruptcy lawyer to handle the filing.
Established in 1983, Clark & Washington is now one of the leading bankruptcy filers in the Southeast. They have locations in Georgia, Florida and Tennessee. Clark & Washington specializes in personal chapter seven and 13 bankruptcy. They offer honest, helpful legal advice to those experiencing financial hardships.
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