Glossary of Common Bankruptcy Terms:
A
Absolute priority: Priority is the order in which debtors are paid during bankruptcy. The typical order is:
Court costs , Statutory claims such as tax claims, and Unsecured creditors claims.
Acceleration clause: A clause in an agreement permitting the creditor to demand immediate payment of the debt even though the stipulated time for repayment has not yet occurred.
Adequate protection: A ssurance to the creditor that they have a claim against the debtor’s assets.
Adversary proceeding: Any court case.
Assets: Any possessions that the debtor owns. They comprise both tangible assets like real estate, cars, and jewelry and intangible assets such as business goodwill; the right to sue ; or stock options. The debtor must report all of his assets on the bankruptcy financial schedules.
Assume a debt: An agreement where one party transfers their right to collect on a debt to another.
Automatic stay: An injunction that prevents commercial consumers from starting or continuing any collection proceeding once the debtor has filed for bankruptcy.
Avoidance: The ability of the bankruptcy court to remove certain liens that are greater than the value of the property, if the property falls under one of the state or federal exemptions.
B
Ballot date: The date on which all votes on a reorganization plan are accepted.
Bankruptcy: A legal action for dealing with monetary liability problems of individuals and businesses.
Bankruptcy Abuse Prevention and Consumer Protection Act (BAPCPA) of 2005: Legislation that was enacted by the Federal government on October 17, 2005 that primarily deals with consumer filings, making it harder to file for Chapter 7 bankruptcy.
Bankruptcy Act of 1898: The first permanent US bankruptcy act that gave companies the option of being protected from creditors. Also called the Nelson Act.
Bankruptcy administrator: Court officials in Alabama and North Carolina with the same responsibilities as trustees in other states.
Bankruptcy Code: The common term for Title 11 of the United States Code that governs all bankruptcy cases.
Bankruptcy Court: The federal court that hears bankruptcy cases.
Bankruptcy Estate: All legal or equitable assets at the time of the bankruptcy filing. The estate includes all property in which the debtor has an interest, even if it is owned or held by another person.
Bankruptcy Judge: A judicial officer of the United States district court with decision-making power over federal bankruptcy cases.
Bankruptcy Mill: A business not authorized to practice law that provides bankruptcy counseling and prepares bankruptcy petitions.
Bankruptcy Petition: The document filed with the court to initiate a bankruptcy proceeding.
Additional Resources
- Chapter 7 Vs Chapter 13
- Recent Changes to Bankruptcy Law
- How to File Bankruptcy
- Bankruptcy Filing Fees
- The Automatic Stay
- The 341-Meeting
Bankruptcy Laws overview | Faqs on Bankruptcy | Bankruptcy Terms
