There are two sides to every story, including those involving bankruptcy. We talk a lot about the work we do for those who are filing for bankruptcy, but we also do quite a bit of work for creditors. In fact, we should probably talk more about this work because we think it is one of the things that makes us one of the best bankruptcy firms in Wisconsin. Working on both sides of the bankruptcy process means we can be better advocates for our clients because we know the other side of the story.
Our Work for Commercial Lenders
Our firm does a lot of work for commercial lenders. We review contracts to make sure that investments will not be completely lost if a deal goes bad, and we help lenders navigate the bankruptcy process when they are owed money by a debtor that has filed for bankruptcy protection.
When one person or business files for bankruptcy it can set off a chain reaction that destabilizes many businesses. We try to minimize the impact a bankruptcy filing has on our clients by encouraging them to make sure that all the loans they make are secured, even if the applicable collateral is unusual.
We also negotiate a lot of workouts. A workout is essentially a renegotiation of an outstanding debt. Being flexible about when payments are due or what interest rate is being charged can help keep a business partner afloat. It is much better to take a small loss than to drive someone into bankruptcy and risk that their bankruptcy will cause your business financial problems.
The Other Side of the V
Another service we provide creditors is representation during bankruptcy proceedings.
In order to preserve a debt owed by someone that has filed for bankruptcy, a creditor must file an adversary matter with the court. Filing an adversary matter puts the court and the debtor on notice that the creditor wants to be paid back. Sometimes these matters involve situations where the debtor has transferred assets to a third party (like a family member) in order to try and preserve the asset.
Having a customer that files for bankruptcy can be a problem even if they have already paid you back because the court may pull payments that were made during the 90 days before the bankruptcy filing back into the bankruptcy estate. The process of pulling paid debts back into the bankruptcy estate is known as a preference action, and there are several defenses to it. The most effective way to fight a preference action is before it occurs, so as soon as you get word that a current or former client has filed for bankruptcy, it is wise to speak with a bankruptcy attorney that has experience working for creditors.
Shape the Story
The radio commentator Paul Harvey used to conclude his broadcast by telling his listeners that they now knew “the rest of the story.” Knowing how a story usually goes, and what the viewpoints of different characters are, makes it easy to predict the ending. Our firm is good at helping our clients tell their side of the story and get the ending they want.