When you go through a bankruptcy for the first time, you’re stepping into the unknown. Even with an attorney to help you, you might get anxious about some of the formal-sounding terms, processes, and documents that you encounter on a daily basis.
One of those documents is the “notice of appearance letter” that you will receive from creditors. It can look scary because it’s from the creditor’s attorney(s), contains a lot of legal verbiage, and sounds intimidating. Notice of appearance? Do you have to appear somewhere? Are you getting sued?
Take a deep breath. No need to worry. Here are a few facts about the notice of appearance letter that should calm your fears:
The notice of appearance letter is a routine document filed by many creditors in most bankruptcy cases.
This filing is just one of many routine things that will happen during your bankruptcy case. Creditors will learn about your bankruptcy, and their attorneys may file notice of appearance letters. It’s standard and normal.
The notice of appearance letter is basically a request to stay informed about your bankruptcy case.
Think of the notice of appearance letter like a request to sign up for email or social media alerts and notifications. Because the creditor’s money is on the line during your bankruptcy case, they want to stay informed about everything that happens to you concerning your bankruptcy.
The notice of appearance letter provides handy contact information for both the creditor and their attorney.
These letters serve as handy documents for you and your attorney in case you need to communicate with the creditor in any way.
You only need to share official legal communications and actions related to your bankruptcy case—and nothing more.
Bankruptcy law strictly defines what can and can’t be shared with the creditors’ attorneys. Generally, any official bankruptcy “events” such as notices, applications, motions, requests, etc. need to be shared with the creditors’ attorneys. However, you are not required by law (no matter what the notice of appearance letter says) to give your creditors information that doesn’t pertain to events in your bankruptcy case or any confidential communications with your attorney.
Secured creditors tend to file notice of appearance letters.
Secured creditors are usually those who hold your mortgage or a car loan. They have legal rights over the debt related to your property (such as a house or car) that are different from the legal rights for unsecured creditors (such as credit card companies). That’s why you can often wipe out unsecured debt but not secured debt. Secured creditors need to make sure you pay what you owe on your house or car, so they are very interested in your bankruptcy proceedings.
Notice of appearance letters can’t violate the law.
No matter what a creditor’s attorney states on their notice of appearance letter, they must adhere to United States bankruptcy law. This is why it’s important to work with your attorney to make sure you don’t feel unnecessarily threatened by a creditor’s attorney and give them information that you’re not legally bound to give them.
In most cases, you don’t need to do anything after a notice of appearance letter is filed.
In other words, it’s not a big deal. As long as the creditors’ attorneys receive the right information, you won’t need to worry about receiving this letter. Your bankruptcy case will proceed as normal.
Going through a bankruptcy case alone? Have you received documentation from creditors that you’re not sure about? Call us for a free consultation.