Bankruptcy Representation For Creditors
As a lender or business owner, you have a stake in the financial woes of your customers. When a customer files for bankruptcy, the debt they owe to you may no longer be collectible — at least not in full.
But for many business owners, the scenario above is less of a headache than dealing with preference actions. If you have received a letter from a trustee or debtor in possession demanding the return of a customer’s recent payment, my firm may be able to help you avoid a more expensive and time-consuming legal battle.
I am attorney John R.K. Solt, and I have been practicing bankruptcy law in Pennsylvania for 40 years. As a lawyer who has represented both debtors and creditors, I am able to examine each client’s case from all angles, and I strive to strike a balance between debtors’ rights and creditors’ rights.
Understanding And Defending Preferences
If a customer sent you a payment within 90 days before filing for bankruptcy, that payment may be treated as a preference. As such, a trustee can demand that it be returned so that any such funds can be redistributed pro-rata to all of the customers’ creditors.
The payment made to your company may have been part of a good-faith business transaction (and not the result of aggressive collection actions, as trustees may assume). In cases of the former, I may be able to help you defend preference actions. If it is not possible to avoid returning the payment altogether, we may be able to negotiate settling the action for significantly less than the total amount demanded.
In either case, acting quickly and with the help of an experienced bankruptcy attorney is crucial.
Businesses and lenders are not the only ones who suffer the collateral consequences of personal bankruptcy. Sometimes family and friends suffer as well. Allegations of fraudulent transfer are a good example.
Debtors often transfer assets out of their own name by turning ownership over to family and friends. Sometimes this is done to intentionally to prevent a creditor from accessing the asset to satisfy a debt. This would undeniably be a case of fraudulent transfer.
But in Pennsylvania, fraudulent transfer can also occur if someone transfers away an asset without intent to harm creditors but doesn’t get something of reasonably equivalent value in exchange for it. If an already insolvent father gives a $5,000 car to his son who his going away to college (and the father then files for bankruptcy), that could technically be considered fraudulent transfer.
If you are a family member or friend of someone in bankruptcy and have been given assets from that person, you may have received a letter from a bankruptcy trustee seeking to recover the asset or its cash equivalent. My firm regularly represents individuals in this situation, and I may be able to help you, too.
Questions For An Experienced Bankruptcy Attorney? Call Today.
Located in Bethlehem, John R.K. Solt, P.C., offers bankruptcy representation for creditors and for others unwitting involved in someone else’s bankruptcy proceedings. To schedule an appointment, call the firm at 800-724-5702. You can also fill out this online contact form.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.