The Influence of Bankruptcy on Collections
Learn how bankruptcy influences collection efforts and how to properly respond to a bankruptcy.
The filing of a bankruptcy always complicates and in many ways frustrates a creditor’s collection efforts. But there are steps that can be taken and strategies that can be employed to maximize the potential for recovery in such situations. Knowing the bankruptcy process, the types of claims and certain advantages provided to creditors in the Bankruptcy Code are key in evaluating the best path. Moreover, preparing for a potential bankruptcy while in the process of settling a collection action can often help mitigate the possible claw back of settlement funds in a future bankruptcy. Knowledge of these issues can greatly benefit internal collections and outside collection counsel if and when a bankruptcy is filed.
• You will be able to discuss the key steps in the bankruptcy process and how they affect creditors and creditors’ rights.
• You will be able to review the effects of the automatic stay and what creditors can and cannot do following a bankruptcy filing.
• You will be able to define the effects of a debtor’s discharge and who gets the benefit of that discharge.
• You will be able to recognize ways to be better positioned against avoidance of settlement payments in the face of a potential bankruptcy filing.