The Chapter 13 Process – Part 7

Now that you have received the claims list, and know who has filed a claim, and the amount they have indicated is owed, you need to make a careful decision with your attorney as to whether or not to file an objection to any of the claims.  My friend, Karen Oakes, wrote a terrific note on why you should file an objection even in a 0% plan. 

The process followed, however, requires a court hearing and a determination as to the amount owed, whether the creditor has added extra costs or fees that they aren’t entitled to receive, and whether they have misclassified the claim as secured or priority when it shouldn’t be either. 

For example, the IRS almost always lists un-paid taxes as priority debts.  Sometimes, however, particularly for old income taxes, they are dischargeable unsecured, non priority obligations.    You should file an objection.  When the IRS gets a copy, they can file an amended claim and resolve the dispute without a hearing. 

If a hearing is necessary, your attorney will file a motion and an objection to the claim with the court and it will be set for an evidentiary hearing.  The creditor will have to substantiate its claim with the supporting documentation attached to the claim.  You will have a chance to object, present your side of the controversy and demonstrate why (and how) the claim is wrongly filed.  The judge will make a decision, and the claim will be either rejected in whole or modified as necessary.