Sell or hold a bankruptcy claim

Choose with the tradeoffs in view.

A sale can turn agreed rights into a negotiated cash payment. Holding preserves the possibility of future recoveries and their uncertainty.

Your timing needs

Consider when you need liquidity and the actual funding conditions in the offer. A payment target measured after diligence is different from a promise measured from your first inquiry.

Your view of recovery

Compare the price with your own assessment of possible distributions, their timing, and the risk of a different outcome. Future recovery estimates are uncertain; a case milestone does not itself promise a payout.

The work of holding

Continuing to hold may involve monitoring notices, addressing objections, maintaining records, and following distribution instructions. Consider the time and adviser costs for your organization.

The obligations after a sale

Review representations, recourse, cooperation duties, and treatment of distributions received after transfer. Selling a claim does not necessarily end every responsibility.

Questions before deciding

What exactly is sold? What amount will arrive initially? What can change that amount? Who verifies closing conditions? When is payment initiated? What happens if a representation proves inaccurate? Use the agreement and your advisers to resolve the answers.

General educational information. The actual agreement and case circumstances control; discuss legal, tax, and financial questions with your advisers.

Your next step

Bring us your questions.