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Secured Claim

Investing in Bankruptcy Claims as a Cash Investment

Investing in bankruptcy claims can be very profitable or can result in a significant, or even total, loss. Bankruptcy claims are a creditor’s right to payment from a debtor. A bankruptcy claim can be secured by the debtor’s property or can be unsecured. Claims are classified in chapter 11 plans of reorganization according to their […]


Considerations When Selling a Bankruptcy Claim

One of your customers sends you notice it has filed for chapter 7 or chapter 11 bankruptcy protection rather than the payment for goods or services provided that you were expecting. You understand that you now have a “claim” against the “debtor,” in bankruptcy parlance. You are not quite sure you want to deal with […]


Mega RV—Lender Compromise Provides Funds to Creditors

A recent settlement agreement in the Mega RV Corp. (“Mega” or the “Debtor”) bankruptcy highlights the interplay between an overzealous lender and a repentant business owner who came together to cooperate and provide a windfall recovery to unsecured creditors. Mega RV was founded in 2000 by Mike McMahon as McMahon’s RV. The Debtor was in the […]


The Fisker Case: My Credit Bid Capped at the Amount I Paid for the Debt?

One way to purchase assets (including the assets of a business as a going concern) is to prevail at a foreclosure sale or a § 363 bankruptcy auction with a credit bid.  The first step is to acquire the senior secured debt on the assets at a steep discount.  The next step is to outbid […]


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