A – D | E – L | M – P | R – V

E – L

E
equity:  The value of a debtor’s interest in property that remains after liens and other creditors’ interests are considered. (Example: If a house valued at $100,000 is subject to a $80,000 mortgage, there is $20,000 of equity.)

executory contract or lease: Generally includes contracts or leases under which both parties to the agreement have duties remaining to be performed. (If a contract or lease is executory, a debtor may assume it or reject it.)

exemptions, exempt property:  Certain property owned by an individual debtor that the Bankruptcy Code or applicable state law permits the debtor to keep from unsecured creditors. For example, in some states the debtor may be able to exempt all or a portion of the equity in the debtor’s primary residence (homestead exemption), or some or all “tools of the trade” used by the debtor to make a living (i.e., auto tools for an auto mechanic or dental tools for a dentist). The availability and amount of property the debtor may exempt depends on the state the debtor lives in (or if multiple states have been lived in in the past 2 years, there is a formula for deciding which state’s law applies). 

family farmer or family fisherman: An individual, individual and spouse, corporation, or partnership engaged in a farming or fishing operation that meets certain debt limits and other statutory criteria for filing a petition under chapter 12.

fraudulent transfer: A transfer of a debtor’s property made with intent to defraud or for which the debtor receives less than the transferred property’s value.

fresh start The characterization of a debtor’s status after bankruptcy, i.e., free of most debts. (Giving debtors a fresh start is one purpose of the Bankruptcy Code.)

G
General Unsecured Claim:  a claim by a creditor against a bankrupt debtor which does not have a priority for payment and for which the creditor holds no security interest or collateral.

I
insider (of individual debtor):  Any relative of the debtor or of a general partner of the debtor; partnership in which the debtor is a general partner; general partner of the debtor; or a corporation of which the debtor is a director, officer, or person in control.

insider (of corporate debtor) A director, officer, or person in control of the debtor; a partnership in which the debtor is a general partner; a general partner of the debtor; or a relative of a general partner, director, officer, or person in control of the debtor.

Involuntary Petition:  A bankruptcy case may be commenced by a specific number of creditors against a debtor without the debtor’s consent.   There are specific requirements for the amount of claims the creditors must hold and number of valid creditors who may commence the case. 11 U.S.C. 303 sets forth the requirements. (please not that the information contained on that link may not be up to date)

J
joint administration: A court-approved mechanism under which two or more cases can be administered together. (Assuming no conflicts of interest, these separate businesses or individuals can pool their resources, hire the same professionals, etc.)

joint petition: One bankruptcy petition filed by a husband and wife together.:  a court order giving a creditor the ability to take any collection remedy allowed under applicable state or federal law against a debtor (for example, wage garnishment, liens, levies, etc.)

judgment proof:  a debtor who has all exempt assets and income so that a creditor cannot collect anything from them even if they obtain a court judgment against them.

L

lien:  The right to take and hold or sell the property of a debtor as security or payment for a debt or duty.

lien stripping:  Refers to the mechanism by which a lien (deed of trust, mortgage, etc.) against property is removed  when  the value of the property is less than the amount owed to any liens senior (above) the one(s) being stripped.

liquidation:  A sale of a debtor’s property with the proceeds to be used for the benefit of creditors.

liquidated claim:  A creditor’s claim for a fixed amount of money.  Even if the amount is not known, it is liquidated if it is “readily capable” of being determined.