"Preferential Payment Bankruptcy"
When a company files for bankruptcy, there is a process that creditors go through to receive payment. In some cases, certain creditors may be given preferential treatment over others. This is known as preferential payment bankruptcy.
Preferential payment bankruptcy occurs when a debtor pays one creditor before others, usually because that creditor is owed a larger amount of money. This can happen if the debtor pays off a loan from one creditor using money that was supposed to go towards another creditor.
Creditors who are owed less money may not receive any payment at all if the debtor chooses to pay off creditors with preferential treatment first. This can be unfair to those creditors, and they may take legal action against the debtor.
Preferential payment bankruptcy can be a complicated process, and it is important to seek legal counsel if you are considering this option.
The Law Offices of Omar Zambrano has helped thousands of people and businesses in the past to get out of debt and start over.
Our main goal is to help you find a fresh start FAST!
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