"Preferential Payment Bankruptcy"

A preferential payment bankruptcy is a type of bankruptcy in which the debtor pays off creditors who are given preferential treatment. This can happen in two ways: either the debtor pays the creditor in full or makes a partial payment to the creditor. There are certain creditors who are given preferential treatment under the law, such as government agencies and employees. If the debtor pays these creditors first, then he or she may be able to discharge the remaining debt owed to other creditors.

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