How Creditors Can Lose Payments Received

Even when a debtor continues to pay its creditors, despite being in poor financial condition, creditors can lose those payments if the debtor files for bankruptcy protection. According to the U.S. Bankruptcy Court strategy that all creditors be treated fairly, some creditors may have to return money that has already been paid. What is specifically in danger is what’s knows as a preference payment. These are payments made by a debtor within 90 days before a bankruptcy petition if filed.

For more information on how to protect yourself from having to repay monies paid to you “in the ordinary course of doing business”, call 1-800-407-9044 or email steve@creditnews.com.

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