As part of filing for bankruptcy, you’ll need to list all the persons or entities you owe money to and the approximate amount of the debt. In most cases, this is fairly straightforward, just requiring you to disclose the creditor and how much you owe. However, in some cases the amount of your obligation isn’t clear yet, or perhaps you haven’t become responsible for the debt yet. In these cases, your bankruptcy attorney will likely recommend listing those claims as contingent, unresolved, or disputed in your initial petition.

The Different Types of Bankruptcy Claims

Contingent Debts

While you may be listed as a creditor on a contingent debt, you won’t be responsible for the payment until a certain event occurs. For instance, you might be listed as a cosigner on a sibling’s personal loan, but you’ll only have to pay if they default on their obligation.

Unliquidated Debts

In some situations, you may be responsible for a debt, but the exact amount hasn’t been determined yet. If, for example, you’re being sued, you won’t know for certain how much you’ll be expected to pay until the final ruling or appeals. Your bankruptcy attorney may recommend listing these debts as unliquidated or waiting until the situation is resolved before filing your petition.

Disputed Debts

Creditors and borrowers often have disagreements over the amount owed, which can be confusing if you’re filing bankruptcy paperwork. The IRS may have a lien against your property for $8,000, while you believe there’s been a mistake and you only owe $1,000. When listing disputed debts, most bankruptcy attorneys recommend claiming the actual amount in collections, regardless of how much you think you owe.

If you’re struggling with debts and constantly fielding creditor calls, turn to the O'Neill Law Firm, LLC for honest legal advice and dedicated debt relief services. With their in-depth understanding of the law and commitment to giving every client the individual attention they deserve, their bankruptcy attorneys will help you reclaim your life from unmanageable debt. Visit their website for more on their bankruptcy services or call (608) 519-3551 to schedule a consultation at their office in La Crosse, WI.