Like all forms of law, bankruptcy has its own terms. Unless you are a bankruptcy lawyer, bankruptcy terminology may sound like a foreign language. At Groce & DeArmon, we don’t want you to confuse you or impress you with our terminology. When you walk through the doors of the Groce & DeArmon, P.C. law firm, we want you to feel comfortable and ready for success. For this reason, the Groce & DeArmon, P.C. team of bankruptcy lawyers have come up with a list of the most important bankruptcy terms that you will want to know before stepping into our office.
Important Bankruptcy Terms
- Automatic Stay
- A court order that stops creditors from foreclosing on your home, repossessing your car, or garnishing your wages once you have filed for bankruptcy
- Creditor
- The person or business to whom the person filing bankruptcy with Groce & DeArmon, P.C. owes money
- Credit Counseling
- A session on managing debt provided by a counseling agency that all debtors must attend before filing bankruptcy
- Debtor
- The person owing money and wishing to file bankruptcy
- Equity
- The monetary value of what a debtor owns in a property after subtracting loans and other aspects of the creditor’s stake in the property
- Exemption
- Any assets that the Bankruptcy Code allows a debtor to keep
- Lien
- The right a creditor has to repossess property from a creditor until that creditor can pay his or her debt
- Liquidation
- The process the creditor takes to sell a debtor’s property to receive owed money
- Plan
- A detailed schedule and description of the debtor’s plan of action to pay off his or her debts
- Preferential Debt Payment
- A payment made within 90 days of the debtor filing bankruptcy that gives a creditor a larger payment than designated by Chapter 7 bankruptcy
- Secured Debt
- Any debt associated with property that a creditor can repossess and sell to make up for back payment
- Statement of Intention
- A statement all debtor’s filing Chapter 7 bankruptcy must make entailing how the debtor will deal with secured debt
- Unsecured Debt
- Any debt without a property attached that a creditor could repossess
File Bankruptcy with Groce & DeArmon, P.C.
Filing bankruptcy can bring you peace during a troubling time. If you find yourself suffocating under too much debt, you can always find help from a bankruptcy lawyer at Groce & DeArmon. We will advise you and guide you toward either Chapter 7 bankruptcy or Chapter 13 bankruptcy, whichever works best for your situation. Contact Groce & DeArmon, P.C. today for bankruptcy advice.
