Creditors' Failure To Appear In Court

[mkjrosen]

During a typical Chapter 7 action for, lets say $10,000 of credit card debt, would the CREDITORS' failure to appear in the court or otherwise CHALLENGE the acton cause the court to be more inclined to find in favor of the debtor, rather than the creditors??

[justbroke]

Well, Creditors need not do anything except file a Claim. This is the same process for every Chapter of Bankruptcy (7, 9, 11, 12, 13). If you were to object to the Claim by filing an Objection, and the creditor never responded, then you could basically get a default judgment disallowing the claim in its entirety (or partially depending upon your prayer for relief).

My objections been sustained on about 21 out of 47 claims in my case.

[keepmine]

During a typical Chapter 7 action for, lets say $10,000 of credit card debt, would the CREDITORS' failure to appear in the court or otherwise CHALLENGE the acton cause the court to be more inclined to find in favor of the debtor, rather than the creditors??

I'm not sure you understand the Chapter 7 process.
After filing, it starts with a 341 meeting with a trustee presiding. A creditor loses no rights by not appearing. They have 60 days from the date of the 341 to file an adverserial proceeding challenging the discharge of their particular debt. These AP's are pretty rare.
Is there anyting in your case that makes you think a creditor would object? They need a solid reason. Just because you owe a lot of money isn't enough-heck, we all owed a lot of money.

[mkjrosen]

Thanks for that. But, hard to picture this. Let's say I have filed my case, in which I indeed LIST four creditors, to which I ADMIT that I owe $2,500 to each. Now, despite such an ADMISSION on my part, if the creditors do NOT formally OPPOSE the discharge (by the Court) of my debts within your said 60-days, well, does that mean that I have "won" the action via "default"?? I.e., how can the Court (the Trustee) summarily discharge my debts, just because the creditors have not challenged such dscharge, when in fact I have fully ADMITTED that I owe such debts?? Am I just stupid??

[OhioFiler]

Thanks for that. But, hard to picture this. Let's say I have filed my case, in which I indeed LIST four creditors, to which I ADMIT that I owe $2,500 to each. Now, despite such an ADMISSION on my part, if the creditors do NOT formally OPPOSE the discharge (by the Court) of my debts within your said 60-days, well, does that mean that I have "won" the action via "default"?? I.e., how can the Court (the Trustee) summarily discharge my debts, just because the creditors have not challenged such dscharge, when in fact I have fully ADMITTED that I owe such debts?? Am I just stupid??

You are not stupid. Bankruptcy discharges your responsibility to the debt. Bankruptcy isn't a Perry Mason movie.

[justbroke]

Thanks for that. But, hard to picture this. Let's say I have filed my case, in which I indeed LIST four creditors, to which I ADMIT that I owe $2,500 to each. Now, despite such an ADMISSION on my part, if the creditors do NOT formally OPPOSE the discharge (by the Court) of my debts within your said 60-days, well, does that mean that I have "won" the action via "default"?? I.e., how can the Court (the Trustee) summarily discharge my debts, just because the creditors have not challenged such dscharge, when in fact I have fully ADMITTED that I owe such debts?? Am I just stupid??

Yes, when you fill out your petition and "schedule" those creditors on Schedule F, you have actually made a statement under penalty of perjury. Just forget about that though, as it's required to make that statement in order to receive a discharge.

The Code reads that a creditor can complain about the dischargeability of that specific debt, if you did certain things. For example, if you fraudulently obtained the card or made a bunch of large purchases (or cash advances) just before filing (presumed so if it's done within 90 days). Most creditors, especially if it's under $4,000... don't even bother with this complaint of dischargeability, because the cost to prosecute the complaint can cost $4,000 or more, easily! It can cost them about $1,000 just to file the complaint ($250 filing fee plus 3 hours of time to prepare the complaint by an attorney at $250/hour... is $1,000).

There is no "action" and there is no "default". You are just granted a discharge. You have not "challenged" them so there is no "judgment" either. This is just how the bankruptcy court and code works.

I think you're thinking too much.

[keepmine]

I'd agree with the others. You're way overthinking this.

[mkjrosen]

Thanks much, to all of you. Yes, monster THINKING over here. I have concluded that my major problem was being too OLD, and, as such, I could no longer understand that it's mostly "younger" people who file bankruptcy, and, when they do, the court, creditors, society at large, all perceive that such a bankrupt person's "social status" has now been so grossly TARNISHED/TAINTED that that alone is "punishment" enough, for the rest of their (LONG) lives. In my case, without too much live left, I totally failed to see this simple point of bankruptcy. With that, I put it to REST. THANKS!! Bet you're all glad to see ME go!!! (No need to reply to that.)

[justbroke]

We are not glad to see you go and want you to stay. You can help others as you go through this process. Each person has a unique perspective based on age, soci-economic background, city, state, county, home ownership, job... just so many factors!

You have no need to apologize. We are all here to help each other.

[mkjrosen]

Well, probably going to file here in No. Dist. Cal., in about 2-weeks, anyway, in pro se. If I do, I'll let you all know the eventual outcome. As an x-con, having recently done 15-yrs. in Cal. stir for fraud-related crimes, and now homeless, to boot, it's hard to imagine anyone with more daunting prospects in a Chapter 7 bankruptcy court.