A secured creditor is a creditor with the benefit of a security interest over some or all of the assets of the debtor.
In the event of the bankruptcy of the debtor, the secured creditor can enforce security against the assets of the debtor and avoid competing for a distribution on liquidation with the unsecured creditors.
In most legal systems, secured creditors also have the option of releasing their security and proving in the liquidation, although, in practice, they would rarely do so.
Other articles related to "secured creditor, secured creditors, creditors, secured":
... company management and interested parties such as a secured creditor that even after restructuring, a "going concern" may still not viable ... A secured creditor or group of secured creditors frequently may encourage the company's senior management to pursue this liquidation mechanism ... Secured creditor(s) may encourage this type of action to relieve themselves of the legal costs and risks associated with the foreclosure and sale of its collateral ...
... The main purpose of any security is to enable the secured creditor to have priority of claim to the bankrupt party's assets in the event of an insolvency ... security (such as a mortgage or fixed charge) and preferential creditors, who are given priority by statute ... by the floating charge, where it would have secondary priority to the claims of the preferential creditors ...
... Generally, a secured transaction is a loan or a credit transaction in which the lender acquires a security interest in collateral owned by the borrower and is entitled to foreclose on or repossess the ... In the United States, secured transactions in personal property (that is, anything other than real property) are governed by Article 9 of the Uniform Commercial Code (U.C.C.) ... The law treats differently those creditors who are secured (i.e ...
... Broadly speaking, holding a floating charge gives the secured creditor two key remedies in the event of non-payment of the secured debt by the company ... Firstly, the secured creditor can crystallise the charge, and then sell off any assets that the charge then attaches to as if the charge was a fixed charge ... and undertaking of the company, the secured creditor can appoint an administrative receiver to take over the management and control of the business with a view to discharging the ...
Famous quotes containing the words creditor and/or secured:
“A creditor is worse than a slave-owner; for the master owns only your person, but a creditor owns your dignity, and can command it.”
—Victor Hugo (1802–1885)
“His [the President’s] earnest desire is, that you may perpetuated and preserved as a nation; and this he believes can only be done and secured by your consent to remove to a country beyond the Mississippi.... Where you are, it is not possible you can live contented and happy.”
—Andrew Jackson (1767–1845)