Proof of Claims and Chapter 13
Date: Mon, 09/21/2009 - 09:02
Why would they not file ?
According to the documents, they can't come after us after the discharge, so do they just write this off ? Very strange !!!
Also, for these creditors, what should it say on our credit report ? Charge off ?
Thanks for the input !
Quote:Why would they not file ? It's hard to know the exact rea
Quote:
Why would they not file ? |
It's hard to know the exact reason but anyway they have forfeited their rights to recover the debts once you get discharged by not responding to the 'proof of claim'.
Yup, after the deadline, they cannot file a claim. If the case
Yup, after the deadline, they cannot file a claim. If the case is successfully discharged, they can never legally come after you for the balance. (However, if the case gets dismissed, then they can resume collection regardless of whether they filed a claim).
I can imagine part of the reason they don't file claims is due to their sheer size/volume, and availability of the original contract. To file a proof of claim, they generally need to send in a copy of the original/signed contract or credit agreement. The original agreement may be located in storage several states away from the office that the BK notice and claim form was mailed to. Add to it that they have hundreds/thousands of employees and millions of customer accounts, I'd argue "their left hand doesn't know what the right hand is doing." And so filing a claim gets lost in the mix.
In certain cases it just might not be economically feasible for them to care. For example, if you have a $300 balance and your BK plan is at 10% repayback -- they only stand to get $30 filing a claim. If they have to pay a clerk to search through millions of files for your original contract, then pay a courier service to ship that contract to scanning, it might actually cost them more to file a claim than they stand to receive out of it. And so economically, it's cheaper for them not to.
Even if they don't file a claim, it should still be reported on your credit as "Included in Chap (7 or 13) bankruptcy. Usually unrated, but can be reported as a chargeoff; they shouldn't report any balance, and the date of activity should be the date of your BK filing (or discharge date if discharged).
Does it happen often that a credit card company won't file a cla
Does it happen often that a credit card company won't file a claim? We are considering Chapter 13 primarily due to credit card debt. If the companies don't file a claim, what happens then?
