Who Gets Paid First?: Creditor Priority in Bankruptcy
When a debtor files for bankruptcy, they may want to give certain creditors priority of payment. However, priority is a complicated issue in these proceedings. In many situations, a debtor will have little to no say about which creditor is given priority during repayment or after liquidation. In these situations, it is often the decision of the court to determine who gets paid first.
If your debt situation has become unmanageable, an experienced legal professional may be able to help. For additional information regarding your options as a debtor facing bankruptcy, contact the Joliet bankruptcy lawyers at the Law Offices of Stuart B. Handelman today at 815-722-2201.
Order of Payment in Bankruptcy
There are some situations in which a debtor may feel especially obligated to a creditor or may see a benefit in paying that party off first during bankruptcy proceedings. However, the debtor doesn’t generally have the ability to choose the order in which creditors will be paid during these proceedings. Instead, priority is generally given to the following:
- Tax agencies
- Employees owed wages
- People owed child support
Other than these prioritized groups, there is often little that a debtor can do to direct how their bankruptcy repayment or liquidation is settled.
If you’re thinking about filing for bankruptcy protection, we may be able to help. Contact the Joliet bankruptcy attorneys at Law Offices of Stuart B. Handelman by calling 815-722-2201 today to discuss your situation with a qualified member of our legal team.