What is the meaning of “claims process”?

The “claims process” in North Carolina creditors rights law refers to the steps taken in order to legally establish a creditor’s claim. The process is necessary in order to secure a legal right to payment and to protect the creditor from any potential legal issues if the debt is not paid. The claims process in North Carolina typically starts with the creditor sending the debtor a written notice telling them that the debt is due. The notice should contain details such as the amount owed, the name and address of the creditor, and the date by which the debt should be paid. The debtor then has 20 days to respond to the notice with payment or to dispute the debt. If payment is not received or a dispute is raised, the creditor can then file a court action to begin the claims process. This involves filing a lawsuit with the courts in the county where the debtor resides or where the business is located, if the debtor is a business. The lawsuit will include the details of the debt and why the creditor is seeking payment. Once the suit is filed, the court will notify the debtor, known as being “served”, that the creditor has started a claims process to recover the debt. The debtor has 20 days to respond to the claim with any evidence or arguments they may have. If nothing is put forward, the court may award the creditor a default judgment in their favor. The judgment is then enforced by the court and the debtor is legally obligated to pay.

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What is the meaning of “claims process”?

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