Surrendering Collateral In Bankruptcy

Overland Park Bankruptcy Attorney

One of the purposes of a bankruptcy reorganization (individual or corporate) is for the debtor to shed himself or herself of obligations that are no longer helping the debtor. Often, secured collateral is dragging down the debtor, and preventing him from getting a fresh start.

In personal cases, sometimes car loans, home loans, equipment loans, and other types of secured collateral needs to be “surrendered” (i.e., given back) to the lender.  In business cases, it often happens that business equipment or real estate of all types will need to be given back to the lender.  The surrender of collateral can present some issues that should be kept in mind.

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