… March under an $830 million financing deal it is arranging with lenders. But already Six Flags’ creditors are squabbling about how to hand the bankruptcy reorganization plan.

Six Flags’ reorganization plan is supported by a steering committee of its secured creditors and led by investment firm Avenue Capital Management, which would take control of the company under the plan.

But the company’s official committee of unsecured creditors opposes the plan saying it undervalues the …

Tags: Chapter 11 Bankruptcy Creditors noteholders Six Flags

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When a debtor files bankruptcy, creditors are required to file a proof of claim if they want to have a chance at payment during the bankruptcy. If a debtor does not object to the proof of claim after it is filed, then the bankruptcy court will basically deem it “allowed.” But what does that mean?  When the bankruptcy court rules that a proof of claim is allowed it means that the creditor’s claim is valid and must be paid …

Tags: Bankruptcy Mistakes Creditors

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… keep two cars but could only do so if it did not diminish bankruptcy plan payments for unsecured creditors.

The details of the Chapter 13 bankruptcy case:

The unmarried Chapter 13 debtor took Means Test deductions for two cars. One was a 2004 Honda Odyssey worth $10,949 and encumbered by a loan with a principal balance of $9,368. The other was a 2007 Ford 500 worth $12,730 and encumbered by a loan with a principal balance of $27,737. Because the Ford was purchased less than 910days …

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… bankruptcy, he/she will receive the protection of an automatic stay.  The automatic stay prevents creditors from taking collection actions against the debtor in bankruptcy and also forbids the creditor from calling, writing, issuing a wage garnishment order, seizing the debtor’s bank account or assets, filing a lawsuit or filing foreclosure on the debtor’s home.  However, there are circumstances where a creditor will seek relief from the automatic stay.

A creditor will seek relief …

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Bankruptcy judge Christopher Sontchi has denied the request of Six Flags’ creditors to file a competing bankruptcy reorganization plan and extended by 60 days the exclusive right of Six Flags to reorganize the company in bankruptcy. The bankruptcy court agreed with Six Flags that allowing creditors to submit a competing bankruptcy plan would have endangered the company’s exit from bankruptcy and possibly the future of the company.

Allowing a competing plan would …

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According to an article in Reuters, unsecured creditors of Freedom Communications Holdings Inc. called the company’s bankruptcy plan “immoral and wicked.”

The article said:

“Freedom’s proposed bankruptcy plan would give secured bank lenders almost all of the reorganized company’s equity and $325 million in new notes. In return, secured lenders including JPMorgan Chase & Co, SunTrust Banks Inc and Union Bank of …

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… practices. If you are considering bankruptcy and have faced illegal collection actions by creditors, you may be able to file a lawsuit against the creditor during bankruptcy.  Here’s what you need to know:

If a creditor has consistently called you and harassed you at your workplace, you may be able to file a lawsuit against them during bankruptcy.

If a creditor has contacted an unauthorized third-party regarding your debt, you may be able to sue them during …

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According to an article in the NYPost, feuding creditors are threatening to force movie studio Metro-Goldwyn-Myer (MGM) into bankruptcy if their demands are not met.

The article said:

“Both sides staked out their positions during two conference calls Wednesday afternoon that lasted a combined six hours, according to a half-dozen sources on the call.

They described the calls, led by Zolfo Cooper restructuring specialist Stephen …

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… about protecting their personal assets. If a business is a corporation, some debtors assume that creditors cannot pursue them personally for debts owed by the corporation. The truth is that creditors may have the power to pursue the debtor’s personal assets under certain circumstances. The most important question a business owner should ask him/herself?

Did you personally guarantee the corporate debt? Although the corporation and its owner(s) are separate, most creditors will not loan …

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… the debtors’ repayment plan because it made special provisions for a “special class” of creditors. These special class creditors would receive their payments in full at the expense of the other creditors.

The bankruptcy case said:

“The debtors’ plan is a sixty-month plan with Hancock and HSB designated as “Special

Class Creditors” and thus classified separately from other unsecured creditors. The debtors’

payments under the plan to the trustee are $624 per month. …

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When a debtor files bankruptcy, creditors have several duties imposed upon them by the bankruptcy court. One of these duties is to stop the collection of income and to return any income that was collected after the bankruptcy petition was filed. For example: If a creditor received a judgment against you and began garnishing your wages after you filed bankruptcy, the creditor would be required to return the money they …

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… did surprise me was that one of the debtors interviewed said she actually sold her blood to repay creditors.

The article said: “I have sold almost everything I own,” said Nelson, who still lives with her parents. “I have been cleaning houses, I’ve been having garage sales, doing a lot of selling clothes to consignment stores. I even have gotten to the point where I have sold my own blood.”

DO NOT sell your blood to repay creditors. Facing a job loss, foreclosure or …

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