In an Ohio bankruptcy case, creditors should know their rights. It is important, during a bankruptcy that creditors receive as much payment as possible before the court discharges any debts. The creditors have rights too. They can speak to the liquidation of a debtor’s assets in Chapter 7 bankruptcies. In Chapter 13 bankruptcies, creditors can speak on behalf of the repayment plan. In addition, creditors can challenge bankruptcy cases and the debtor’s discharge of debt.
As understood by creditors’ rights, all creditors have rights to shared payment from the estate. Priority goes to a variety of different creditors, including those with secured claims. Secured claims are claims that collateral secures. In these claims, a creditor may repossess and sell the property after defaulted payments.
If creditors have liens on property, then they have rights to receive a value equal to the debt or collateral. In Chapter 7 bankruptcy, if tangible collateral secures the debt, the debtor may buy back the property based on the replacement value. If creditor and debtor cannot come to an agreement on the replacement value, then the court may hold a hearing to determine the value. In Chapter 13 bankruptcy, the creditor has the right to the collateral or he or she may receive payments for the debt over the repayment plan. In some cases, creditors may receive payments outside of the repayment plan that provides a payoff in a short period of time.
All of the above information on creditors’ rights is to be used for educational purposes. None of the above is legal advice.