Learn the Language of Bankruptcy with Our Kansas City Attorneys

Navigate Bankruptcy with Confidence

Understanding the terminology used in bankruptcy proceedings can be overwhelming. Our Kansas City bankruptcy attorneys are here to help you make sense of it all. Here’s a guide to some common bankruptcy terms you may encounter:

• 341 Meeting: The first meeting of creditors where the debtor must attend, and creditors may participate.
• Absolute Priority: Refers to the order of payment to creditors as determined by the U.S. Bankruptcy Code.
• Adequate Protection: Ensures that a creditor’s interest in the debtor’s property is not devalued during bankruptcy.
• Adjustable Rate Mortgage (ARM): A mortgage with payments that change periodically, unlike a fixed-rate mortgage.
• Administrative Claim: Debt incurred after filing for bankruptcy, requiring court approval.
• Adversary Proceeding: A lawsuit filed in bankruptcy court, often involving disputes over the bankruptcy stay.
• Allowed Claim: A creditor’s claim approved by the bankruptcy court.
• Automatic Stay: A provision that halts most collection actions against the debtor once bankruptcy is filed.
• Bankruptcy Estate: The debtor’s property under the authority of the bankruptcy court.
• Bankruptcy Petition: The legal document filed to initiate a bankruptcy case.
• Bankruptcy Trustee: An individual appointed to oversee the bankruptcy process.
• Chapter 7 Bankruptcy: Known as “liquidation” bankruptcy, where non-exempt assets may be sold to pay debts.
• Chapter 13 Bankruptcy: A “reorganization of debts” allowing debtors to create a repayment plan over three to five years.
• Claims: Rights to repayment filed by creditors against a debtor.
• Collateral: An asset pledged as security for a loan.
• Confirmation: Court approval of a bankruptcy reorganization plan.
• Conversion: Changing from one bankruptcy chapter to another.
• Credit Counseling Briefing: A session outlining credit counseling opportunities and budget analysis.
• Creditors’ Committee: A group representing creditors’ interests in a bankruptcy case.
• Debtor: An individual or entity that owes money.
• Discharge: The elimination of debt, marking the end of bankruptcy proceedings.
• Exemptions: Assets protected from liquidation in a Chapter 7 bankruptcy case.
• Lien: A legal claim on property as security for a debt.
• Liquidation: Converting assets to cash to pay creditors.
• Means Test: A calculation to determine eligibility for Chapter 7 bankruptcy.
• Secured Debt: Debt backed by collateral, such as a mortgage or car loan.
• Unsecured Debt: Debt not backed by collateral, like credit card debt.

Why Understanding These Terms Matters

Knowing these terms can empower you to make informed decisions about your financial future. Whether you’re considering filing for bankruptcy or just want to learn more, our attorneys are ready to assist you.

Contact Us for a Free Consultation

If you’re struggling with debt and considering bankruptcy, contact our Kansas City bankruptcy attorneys for a free consultation. We’ll help you determine if bankruptcy is the right option for you and guide you through the process with clarity and support.