Business Bankruptcy | Assignments
Understanding Bankruptcy Assignments
An assignment for the benefit of creditors is an alternative to a Chapter 7 bankruptcy, and they have many similarities. Under an assignment, an assignee is used to liquidate a business’ assets and distribute the proceeds among a business’ creditors. Any remaining funds are returned to the business owner(s) and shareholders. An assignee operates much like a bankruptcy trustee without the restrictions imposed by federal bankruptcy law.
When to Use Bankruptcy Assignments
Liquidating through an assignment is not as common as liquidating using Chapter 7 bankruptcy, but there are circumstances for which when it may indicated. For example, when a single creditor will receive all or most of a company’s assets, an assignment might be beneficial. At Springer Brown, we are skilled in business liquidation and identifying when to pursue an assignment and when to file for Chapter 7 bankruptcy protection. We will closely examine your company’s financials and work with you to choose the most appropriate means of liquidation.
If you are considering going out of business, call us to schedule a free consultation. Our firm serves businesses and individuals in DuPage, Kane, Kendall and Will counties.