The bankruptcy trustee pays priority debts in complete before having to pay nonpriority debts.
Whenever you fill in your bankruptcy documents, you’ll list your financial situation based on kind. You’ll start with isolating your financial situation into two groups: guaranteed debts guaranteed in full by collateral and debt that is unsecured. Bankruptcy legislation further divides unsecured debt into two extra groups: concern debts which can be eligible to be compensated first, and nonpriority debts.
In this specific article, you’ll learn the differences when considering concern and debts that are nonpriority and exactly why it matters in Chapter 7 and Chapter 13 bankruptcy.
In the event that you already know just the financial obligation is unsecured, skip this area. The payment of secured debt, but not an unsecured debt if you’re not sure, the factor that defines secured from unsecured debt is this: Collateral or property guarantees.
You can find out whether you have got a secured or unsecured debt by thinking about both of these concerns:
- Does your contract let the loan provider to simply take your home in the event that you neglect to spend as agreed? (더 보기…)