Final Exam Flashcards
a deed instrument in which a mortgagor conveys all interest in a real property to the mortgagee to satisfy a loan that is in default and avoid foreclosure proceedings
Deed-in-lieu of Foreclosure
mandatory counseling to provide basic education on financial management and help the creditor avoid bankruptcy
Credit Counseling Requirement
Execution
the carrying out of some act or course of conduct to its completion
the deadline set for creditors in a case to file proof of claims. Claims not filed by the bar date may be disallowed or subordinated to other claims
Claims Bar Date
When would a court consider appointing a trustee instead of having a debtor-in-possession?
The court would appoint a trustee if the debtor has previous fraud, if it is in the interest of the creditors, or as an alternative to converting to a Chapter 7 liquidation case
a loan that is not protected by collateral
Unsecured Debt
where two or more bankruptcy cases involving affiliated debtors are ordered to be administered jointly to save administrative costs
Joint Administration
three-party contingent liability agreement under which a third-party agrees to be directly or collaterally responsible for the obligation of a first-party to a second-party in case the first-party defaults
Guaranty Agreement
Liquidation Proceeding
proceeding in which certain property of a debtor is taken into custody by a trustee to be sold, the proceeds to be distributed to the debtor’s creditors in satisfaction of their claims
What does a Chapter 13 case do?
Reorganizes and adjusts debt
What does a Chapter 9 do?
Adjusts debts for a municipality
something pledged as security for repayment of a loan, to be forfeited in the event of a default
Collateral
Unsecured Debt
a loan that is not protected by collateral
an agreement between a lender and a borrower to give the property to a neutral third party who will serve as a trustee
Deed of Trust
additional steps required to be taken in relation to a security interest in order to make it effective against third parties or to retain its effectiveness in the event of default by the grantor of the security interest
Perfection
bankruptcy trustee gathers and sells the debtor’s nonexempt assets and uses the proceeds of such assets to pay holders of claims (creditors) in accordance with the provisions of the Bankruptcy Code
Chapter 7
Purchase Money Security
security interest or claim on property that enables a lender who provides financing for the acquisition of goods or equipment to obtain priority ranking ahead of other secured creditors
What is the liquidation test or best interests of the creditors test in reorganization proceedings and how does it work?
It is one of thirteen requirements that a plan proponent must satisfy in order to obtain confirmation of its plan of reorganization, guaranteeing that unless it otherwise agrees, each creditor or interest holder will receive at least as much under the plan as it would in a liquidation of the debtor in a chapter 7 case.
a meeting that occurs in every bankruptcy case and permits questions to be asked of the debtor(s)
Meeting of Creditors
What is a cramdown/modification of a secured debt?
A cramdown can lower the loan balance secured by the collateral and a reduction in the interest rate to be paid
a document filed in a specialized federal court to commence a proceeding to provide a means by which a debtor who is unwilling or financially unable to pay personal debts will satisfy the claims of his or her creditors as they come due
Petition
a right to keep possession of property belonging to another person until a debt owed by that person is discharged
Lien
an unsecured money judgment against a borrower whose mortgage foreclosure sale did not produce sufficient funds to pay the underlying promissory note, or loan, in full
Deficiency Judgment
Promissory Note
a signed document containing a written promise to pay a stated sum to a specified person or the bearer at a specified date or on demand
agreement with a creditor to pay the creditor a debt that could have been discharged in bankruptcy
Reaffirm Debt
an unsecured claim entitled to a certain order of preferment and payment under section 507
Priority Claims
the writing that a creditor submits as evidence of its claim against the estate
Proof of Claim
a document that provides a lender a security interest in a specified asset or property that is pledged as collateral
Security Agreement
a court order directing that money or property of a third party be seized to satisfy a debt owed by a debtor to a plaintiff creditor
Garnishment
a person appointed by the United States Trustee, an officer of Department of Justice, to represent the debtor’s estate in a bankruptcy proceeding
Bankruptcy Trustee
the order in which a debtor should pay an unsecured claim
Priority
Priority
the order in which a debtor should pay an unsecured claim
Writ of Fieri Facias
a writ of execution after judgment obtained in a legal action for debt or damages for the sheriff to levy on goods of the judgment debtor
Insolvency
An incapacity to pay debts upon the date when they become due in the ordinary course of business
Judicial lien
lien obtained by judgment, levy, sequestration or other legal or equitable process or proceeding
Debtor
person liable for a debt
Balloon Note
a name given to a promissory note in which repayment involves a balloon payment
An incapacity to pay debts upon the date when they become due in the ordinary course of business
Insolvency
Perfection
additional steps required to be taken in relation to a security interest in order to make it effective against third parties or to retain its effectiveness in the event of default by the grantor of the security interest
a bankruptcy case in which the debtor is an individual with primarily consumer debts
Consumer Bankruptcy Case
Meeting of Creditors
a meeting that occurs in every bankruptcy case and permits questions to be asked of the debtor(s)
Consolidation
the joining together of two or more bankruptcy cases involving interrelated debtors into one case for joint administration
Proof of Claim
the writing that a creditor submits as evidence of its claim against the estate
person liable for a debt
Debtor
Petition
a document filed in a specialized federal court to commence a proceeding to provide a means by which a debtor who is unwilling or financially unable to pay personal debts will satisfy the claims of his or her creditors as they come due
the rearrangement of a debtor’s finances under a court-approved plan as an alternative to liquidation
Reorganization Proceeding
Fair Debt Collection Practice Act; FDCPA regulates debt collectors
What is the FDCPA and what type of conduct does it govern?
Lien
a right to keep possession of property belonging to another person until a debt owed by that person is discharged
Collateral
something pledged as security for repayment of a loan, to be forfeited in the event of a default
What does FDCPA mean?
Fair Debt Collection Practices Act
Mechanic’s/Materialman’s Lien
security interest in the title to property for the benefit of those who have supplied labor or materials that improve the property
a loan that is guaranteed by collateral
Secured Debt
Reorganization Proceeding
the rearrangement of a debtor’s finances under a court-approved plan as an alternative to liquidation
Mortgage
The consensual security interest in real property granted by a debtor to a creditor that entitles the creditor upon default to take possession of and sell the realty and apply the proceeds to the balance owed
Short Sale
a sale of real estate in which the net proceeds from selling the property will fall short of the debts secured by liens against the property
What does a Chapter 12 do?
Reorganizes debt for farmers or fisherman with regular annual income
a source or amount of income exempted from taxation
Exemption
Credit Counseling Requirement
mandatory counseling to provide basic education on financial management and help the creditor avoid bankruptcy
Guaranty Agreement
three-party contingent liability agreement under which a third-party agrees to be directly or collaterally responsible for the obligation of a first-party to a second-party in case the first-party defaults
Priority Claims
an unsecured claim entitled to a certain order of preferment and payment under section 507
Deficiency Judgment
an unsecured money judgment against a borrower whose mortgage foreclosure sale did not produce sufficient funds to pay the underlying promissory note, or loan, in full
Chapter 7
bankruptcy trustee gathers and sells the debtor’s nonexempt assets and uses the proceeds of such assets to pay holders of claims (creditors) in accordance with the provisions of the Bankruptcy Code
Disinterested Person
person that is not a creditor
proceeding in which certain property of a debtor is taken into custody by a trustee to be sold, the proceeds to be distributed to the debtor’s creditors in satisfaction of their claims
Liquidation Proceeding
enforceable claim or lien created by a security agreement, or by the operation of law, that secures the fulfillment of a pledge
Security Interest
What is the purpose, terms and application for the means test?
The purpose of the means test is to see if the debtor makes under the state median income for the family size and to see if they need to file a Chapter 13 instead
What does a Chapter 11 do?
Reorganizes or liquidates for businesses
Security Agreement
a document that provides a lender a security interest in a specified asset or property that is pledged as collateral
Bankruptcy Trustee
a person appointed by the United States Trustee, an officer of Department of Justice, to represent the debtor’s estate in a bankruptcy proceeding
Consumer Bankruptcy Case
a bankruptcy case in which the debtor is an individual with primarily consumer debts
a mortgage or other charge on property or assets
Encumbrance
Why is there a Chapter 11 debtor-in-possession?
There is a debtor-in-possession for chapter 11 because a business has a lot of inventory and assets that have to be gone through in a certain amount of time
lien obtained by judgment, levy, sequestration or other legal or equitable process or proceeding
Judicial lien
Repossession
the action of retaking possession of something, in particular when a buyer defaults on payments
Foreclosure
the action of taking possession of a mortgaged property when the mortgagor fails to keep up their mortgage payments
What is a Chapter 11 debtor-in-possession?
The legal status given a debtor filing a Chapter 11 and the debtor retains possession and control of its assets while reorganizing as well as the right to continue operating the business
the prohibition on creditors continuing collection efforts against a debtor that arises automatically upon the debtor’s filing of a bankruptcy petition
Automatic Stay
Surrender
the act of relinquishing property to another
Security Interest
enforceable claim or lien created by a security agreement, or by the operation of law, that secures the fulfillment of a pledge
What is the applicable commitment period for a Chapter 13 debtor and what decides which commitment period governs?
The commitment period is 3-5 years and the debtor must complete the Official Form 122C-1 to determine the applicable commitment period
Reaffirm Debt
agreement with a creditor to pay the creditor a debt that could have been discharged in bankruptcy
a chapter 7 liquidation case in which there are no assets available for distribution to creditors
No-asset Case
security interest in the title to property for the benefit of those who have supplied labor or materials that improve the property
Mechanic’s/Materialman’s Lien
Discharge
release from the payment of debts by a person who is bankrupt
security interest or claim on property that enables a lender who provides financing for the acquisition of goods or equipment to obtain priority ranking ahead of other secured creditors
Purchase Money Security
a name given to a promissory note in which repayment involves a balloon payment
Balloon Note
Exemption
a source or amount of income exempted from taxation
the carrying out of some act or course of conduct to its completion
Execution
an amount of credit extended to a borrower
Line of Credit
Joint Administration
where two or more bankruptcy cases involving affiliated debtors are ordered to be administered jointly to save administrative costs
Line of Credit
an amount of credit extended to a borrower
Business Bankruptcy Case
a bankruptcy case in which the debtor is an entity or individual with primarily business debts
a debtor’s right to buy back property that has been repossessed or foreclosed on
Redeem Property
The consensual security interest in real property granted by a debtor to a creditor that entitles the creditor upon default to take possession of and sell the realty and apply the proceeds to the balance owed
Mortgage
person that is not a creditor
Disinterested Person
Encumbrance
a mortgage or other charge on property or assets
Deed of Trust
an agreement between a lender and a borrower to give the property to a neutral third party who will serve as a trustee
appointed official in federal districts responsible for appointment and supervision of bankruptcy trustees and general oversight of bankruptcy cases in that district
U.S. Trustee
Claims Bar Date
the deadline set for creditors in a case to file proof of claims. Claims not filed by the bar date may be disallowed or subordinated to other claims
the action of retaking possession of something, in particular when a buyer defaults on payments
Repossession
the action of taking possession of a mortgaged property when the mortgagor fails to keep up their mortgage payments
Foreclosure
Deed-in-lieu of Foreclosure
a deed instrument in which a mortgagor conveys all interest in a real property to the mortgagee to satisfy a loan that is in default and avoid foreclosure proceedings
a bankruptcy case in which the debtor is an entity or individual with primarily business debts
Business Bankruptcy Case
Automatic Stay
the prohibition on creditors continuing collection efforts against a debtor that arises automatically upon the debtor’s filing of a bankruptcy petition
release from the payment of debts by a person who is bankrupt
Discharge
No-asset Case
a chapter 7 liquidation case in which there are no assets available for distribution to creditors
certain disputes defined by Bankruptcy Rule 7001 that arise in a bankruptcy case and are resolved by the procedures governing s formal lawsuit
Adversary Proceeding
Secured Debt
a loan that is guaranteed by collateral
a sale of real estate in which the net proceeds from selling the property will fall short of the debts secured by liens against the property
Short Sale
Liquidation proceeding and no asset cases
What is a Chapter 7 do?
Garnishment
a court order directing that money or property of a third party be seized to satisfy a debt owed by a debtor to a plaintiff creditor
Adversary Proceeding
certain disputes defined by Bankruptcy Rule 7001 that arise in a bankruptcy case and are resolved by the procedures governing s formal lawsuit
a writ of execution after judgment obtained in a legal action for debt or damages for the sheriff to levy on goods of the judgment debtor
Writ of Fieri Facias
a signed document containing a written promise to pay a stated sum to a specified person or the bearer at a specified date or on demand
Promissory Note
What debts are not dischargeable?
tax debt, student loans, domestic support obligations, fines owed to govt, unlisted debts, debts from fraud, last minute purchace of luxury goods
the joining together of two or more bankruptcy cases involving interrelated debtors into one case for joint administration
Consolidation
Redeem Property
a debtor’s right to buy back property that has been repossessed or foreclosed on
U.S. Trustee
appointed official in federal districts responsible for appointment and supervision of bankruptcy trustees and general oversight of bankruptcy cases in that district
the act of relinquishing property to another
Surrender
