Creditors’ Rights 1
A: Congratulations for taking the initiative to protect your interests. All too often creditors let valuable time pass before taking affirmative steps to ensure that they are protected in a bankruptcy proceeding. With an equipment lease, you must wait 60 days from the time the bankruptcy is filed to allow the debtor to decide whether to keep or reject the lease. On the 60th day, you can file a motion in bankruptcy court to compel the debtor to make all the payments due or cancel the lease. If the debtor decides to assume the lease, he must cure all past defects. And since you filed to compel the debtor’s decision in a timely manner, you are entitled to priority in the bankruptcy proceedings should the debtor default on the lease payments.