Las Vegas Creditors’ Rights in Bankruptcy — Protecting What You’re Owed

When a borrower files for bankruptcy, creditors often feel like the rug has been pulled out from under them. Suddenly, lawsuits and foreclosures stop, payments freeze, and the borrower gets breathing room, all while you’re left wondering if you’ll ever see your money.

But bankruptcy doesn’t erase a creditor’s rights. In fact, creditors who know how to navigate the system can protect themselves, enforce their claims, and sometimes even recover more than they thought possible.

At Larson & Zirzow, we help creditors in Las Vegas, including hard money lenders, commercial landlords, vendors, and secured creditors, assert their rights strategically when a debtor files for bankruptcy in Nevada.

What Happens to Creditors When Someone Files Bankruptcy?

When a debtor files for bankruptcy, the Automatic Stay immediately kicks in. This freeze stops creditors from collecting debts, foreclosing on property, repossessing collateral, or pursuing lawsuits.

The idea is to give the debtor time to reorganize or liquidate assets fairly. But sometimes, the Automatic Stay unfairly traps creditors in limbo, especially when the debtor is misusing the process or delaying the inevitable.

That’s where Larson & Zirzow comes in. We help creditors cut through red tape, challenge improper filings, and recover to the full extent the law allows.

Getting the Automatic Stay Lifted — A Key Tool for Creditors

Because the Automatic Stay is one of the most powerful tools a debtor in bankruptcy has, getting relief from the stay can be a game changer for creditors.

For example, hard money lenders often loan against real estate at higher risk and higher interest rates. When a borrower defaults, the lender needs to foreclose quickly to protect its collateral. But when the borrower files bankruptcy — sometimes on the eve of foreclosure — the sale comes to a screeching halt.

In these cases, we help lenders and other secured creditors file motions to terminate, annul, modify, or condition the Automatic Stay, depending on the situation. If a creditor can show the debtor has no equity in the property, no realistic chance of reorganizing, or filed multiple bankruptcies to stave off foreclosure, the court can grant stay relief, allowing the foreclosure to proceed.

Fast action and persuasive arguments make the difference. We know from experience what judges look for and how to build the strongest possible case.

Filing Proofs of Claim and Getting in Line to Be Paid

In bankruptcy, creditors must file a Proof of Claim to be paid. If you don’t file a claim or file one incorrectly, you could miss out on getting paid what you’re owed.

We help creditors file timely, accurate claims that protect thier priority, secured, or unsecured status. We also monitor cases to ensure you get notice of any proposed plans, objections, or changes potentially affecting your recovery.

Challenging Discharge or Dischargeability in Nevada Bankruptcy Courts

Some debts simply shouldn’t be wiped out in bankruptcy, like debts obtained by fraud or in situations where the debtor filed for bankruptcy in bad faith.

We help creditors file nondischargeability complaints under Sections 523 and 727 of the Bankruptcy Code, which can prevent a debtor from discharging certain debts or, in extreme cases, deny the debtor a discharge entirely. These adversary proceedings involve tight deadlines and require strong evidence. We know how to prepare and argue these claims effectively, because we’ve done it successfully in Las Vegas time and again.

Defending Against Preference and Avoidance Actions

Creditors can also find themselves on the defensive. Sometimes, a trustee or debtor tries to claw back payments you received before the bankruptcy — so-called preferential transfers or fraudulent conveyances.

We help creditors defend against these Adversary Proceedings, showing that payments were made in the ordinary course of business, that you gave new value, or that other defenses apply. Our goal is to protect what you were legitimately paid and minimize any surprise repayment demands.

Enforcing Secured and Priority Claims

Secured creditors have special rights in bankruptcy. If you have a lien or security interest, whether it’s real estate, equipment, vehicles, or inventory, you’re entitled to adequate protection of your interest in collateral.

We help lenders monitor debtors’ use of collateral, object to plans that shortchange your rights, and negotiate payment terms that protect your investment. If necessary, we litigate to recover or repossess assets when the debtor defaults.

Opposing Chapter 11, Subchapter V, or Chapter 13 Plans

In business bankruptcies under Chapter 11 or Subchapter V, or consumer bankruptcies under Chapter 13, the plan of reorganization determines who gets paid, how much, and over what time. Not all plans treat creditors fairly or even comply with the requirements of the Bankruptcy Code.

We represent creditors who want to oppose a proposed plan or negotitate for more favorable treatment. We review the plan’s feasibility, good faith, and how it handles your claim. If it falls short, we advocate for changes or ask the court to reject the plan outright.

Landlords, Vendors, and Trade Creditors

Not all creditors are lenders. Commercial and residential landlords often get dragged into bankruptcy when a tenant files bankruptcy to reject a lease or avoid eviction. Vendors and suppliers may be stuck with unpaid invoices or returned goods.

We help these creditors protect leasehold rights, claims for damages, and maximize recovery. We also negotiate critical vendor status when appropriate, so you can keep doing business while protecting your past-due balance.

Officers, Directors, Personal Guarantees, and Cosignors

Sometimes, creditors need to pursue officers, directors, or guarantors when a company’s bankruptcy won’t repay the debt in full. Consumer debtors often have cosignors on loans who may remain personally liable for a discharged debt.

Our team knows how to analyze potential insider liability, fraudulent transfers, breaches of fiduciary duty, and potential cosignor liability, to determine whether it’s worth pursuing recovery outside the main bankruptcy case.

Why Larson & Zirzow for Creditor Representation in Las Vegas?

We’re not a volume-filing bankruptcy mill; we’re a boutique bankruptcy law firm with deep experience in the complexities of bankruptcy law from all sides. We know the tactics debtors and creative counsel can use to drag out cases or shield assets, and we know how to fight back with smart, legal strategies.

Among our experienced legal team, you’ll find a Board-Certified Business Bankruptcy Specialist, which means your case is in the hands of an attorney with recognized, advanced expertise and a credential few lawyers in Nevada can lay claim to.

Whether you’re a hard money lender pursuing foreclosure, a secured creditor fighting for priority or adequate protection, or a vendor trying to get paid, we have the knowledge and courtroom skill to protect what you’re owed.

Talk to Us Today

When a debtor files for bankruptcy, you don’t have to sit back and accept whatever scraps are left. You have rights, and we know how to enforce them on your behalf.

Contact Larson & Zirzow today to learn how we can protect your claim, challenge improper discharges, lift the Automatic Stay, and secure your recovery. Let’s fight for what you’re entitled to with focus, experience, and results.