Perspectives

Chapter 7 Bankruptcy: A Credit Manager’s To-Do-List

Bankruptcy , Business Law , Collections , WFJ Business Services WFJ Law Firm

 

When a customer files for Chapter 7 bankruptcy, it’s crucial to act swiftly and strategically to protect your company’s financial interests. Below is a practical to-do list for credit managers and finance professionals navigating this complex process.

  • Confirm the filing

Verify the bankruptcy filing by obtaining the case number and confirming the court’s jurisdiction.

  • Comply with the Automatic Stay

Cease all collection activities immediately to avoid potential penalties for violating the automatic stay.

  • Obtain the Petition and Mailing Matrix

Review the bankruptcy petition and mailing matrix to ensure your debt is listed correctly Confirm your company’s mailing address to receive important notices.

  • File a Proof of Claim

Submit a timely proof of claim to establish your right to receive any distributions from the debtor’s estate.

  • Review Recent Transactions

Examine transactions within the last 90 days for potential preferential payments that may be subject to crawlback.

  • Evaluate Fraud Concerns

If you suspect fraud, consider pursuing and adversary proceeding to challenge the discharge of the debt.

  • Confirm Lien and Bond Rights

Ensure your lien or bond rights are presereved. These rights may offer additionaly protections, even during bankruptcy.

Take Action Today

Navigating a customer’s bankruptcy requires attention to detail and expert legal guidance. Wagner, Falconer & Judd specializes in protecting creidtor’s rights. Contact us to ensure your business is positioned for the best possible outcome in Chapter 7 cases.

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