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Understanding the Statement of Intention [Bankruptcy] and Its Importance
Definition & Meaning
A statement of intention is a formal document submitted by a debtor in a Chapter 7 bankruptcy case. This declaration outlines the debtor's plans regarding secured debts, including which debts they intend to reaffirm and which properties they plan to surrender or retain. The statement must be filed before the creditors' meeting and serves as a guide for how the debtor intends to manage their secured consumer debts during the bankruptcy process. It is important to note that a statement of intention is not required in Chapter 13 bankruptcy cases.
Table of content
Legal Use & context
The statement of intention is primarily used in bankruptcy law, specifically in Chapter 7 cases. It is an essential part of the bankruptcy process, helping both the debtor and the court understand how the debtor plans to handle secured debts. This document can be crucial for individuals navigating bankruptcy without legal representation, as it provides a clear outline of their intentions regarding secured consumer debts. Users can find templates for this document through resources like US Legal Forms, which offers legal forms drafted by experienced attorneys.
Real-world examples
Here are a couple of examples of abatement:
(hypothetical example) A debtor files for Chapter 7 bankruptcy and submits a statement of intention indicating they wish to reaffirm their mortgage on their home while surrendering their car, which is also under a secured loan.
Comparison with related terms
Term
Definition
Key Differences
Statement of Intention
A document outlining a debtor's plans for secured debts in Chapter 7 bankruptcy.
Specific to Chapter 7; not required in Chapter 13.
Reaffirmation Agreement
A formal agreement to continue paying a debt that would otherwise be discharged in bankruptcy.
Requires a separate document; reaffirmation agreements are often part of the statement of intention.
Chapter 7 Bankruptcy
A type of bankruptcy that allows for the discharge of unsecured debts.
Chapter 7 includes the statement of intention, while Chapter 13 focuses on repayment plans.
Common misunderstandings
What to do if this term applies to you
If you are filing for Chapter 7 bankruptcy, it is crucial to prepare a statement of intention. This document will help clarify your plans regarding secured debts. You can use templates available through US Legal Forms to create your statement. If your situation is complex or you have questions, consider seeking assistance from a legal professional to ensure you understand your options and obligations.
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