A major part of a successful business is collecting on your accounts and debts. Creditors do not have to give up upon discovering a bankruptcy petition was filed by a debtor. The ultimate goal is full collection from your debtor, and there are many factors involved to make sure you get the greatest payment. However, most of your rights are contingent on acting fast. The McMillan Law Group can quickly determine what will be necessary to preserve your debt owed by a debtor.
Creditors have a few powerful methods for dealing with a bankruptcy.
Opposing Lien Strip Motions
A debtor can move the Bankruptcy Court to void a lien on property when the value of the property is less than that of a senior lien. This is a serious attack on a creditor’s investment. Once the lien is stripped the creditor’s claim is unsecured. MLG will aggressively protect your investment.
A lien stripping motion is essentially a lawsuit. MLG applies a litigation-based strategy, and can afford to focus on your case. We can focus on your opposition, because we are not a high volume firm.
Battle of Appraisers
MLG will aide you in the battle of determining the fair market value of the secured property. The debtor’s valuation is highly self-serving, and we can analyze its credibility. You must offer a valuation from a certified appraiser showing that the property value is high enough to make your lien at least partially secured. This strategy allows you to position your claim as undersecured, rather than wholly unsecured. An undersecured claim has priority in bankruptcy, and the debtor’s lien strip motion will be denied. Nobelman v. American Bank Savings, 508 U.S. 324 (1993).
A junior creditor can waive their right to an adversary proceeding if they do not affirmatively move the court to reject motions for a lien strip outside of an adversary proceeding. In re Forrest, 410 B.R. 816 (Bankr. N.D. IL 2009). MLG can aid your defense by requiring the debtor to fully litigate the validity, priority, or extent of lien as required by the Bankruptcy Code.
MLG can defend your security by showing the debtor is ineligible for bankruptcy protection. We can do this in a Chapter 13 if the secured debt is converted to unsecured debt makes the unsecured debt exceed the §109(e) limits (currently $360,475.)
Objections to Dischargeability
A debt may be non-if it (1) was obtained by fraud; (2) is for domestic support; (3) is related to a willful and malicious injury; or (4) is for a death or injury caused by an intoxicated driver.
MLG will file a complaint in the Bankruptcy Court objecting to the dischargeability of your debtor’s debt. In many cases, the complaint must be filed quickly after learning of the debtor’s bankruptcy.
Let McMillan Law Group Represent You
If you need legal assistance enforcing your rights as a creditor, call MLG. We provide an free consultation, and quickly and aggressively defend your rights.