The Federal Rules of Bankruptcy Procedure changed in a number of ways on December 1, 2017, impacting bankruptcy cases in Michigan and across the United States. The primary effects of the changes involve Chapter 13 cases where creditors have secured claims, unsecured claims or judgment liens. Broadly speaking, the changes require greater attention or action on the part of creditors in Chapter 13 cases and establish new deadlines for creditors.
The changes to the bankruptcy rules shorten the window during which creditors may file proofs of claim, for example. A creditor must now file a proof of claim within 70 days of the bankruptcy filing; prior to the rule changes, creditors had 90 days after the Section 341 meeting during which to make these filings. Creditors will not receive plan payments if they fail to file proofs of claim.
A debtor can request that a judicial lien be removed within the Chapter 13 plan. Prior to the rule changes, debtors were required to file a separate motion to request this type of relief. Debtors may also now request valuations of collateral and reductions of secured claims within the Chapter 13 plan; this is another action that required a separate motion before the rule changes. Debtors may file motions at the conclusion of a Chapter 7, 12 or 13 action to get an order saying that a particular secured debt has been satisfied.
In a case where an individual is experiencing difficulty paying down debts, an attorney may be able to help. An attorney who practices bankruptcy law may be able to suggest options to reduce or eliminate debt or may be able to negotiate with creditors on the client’s behalf. An attorney might assist with the drafting and filing of a bankruptcy petition or represent the client during meetings with creditors or government officials.