ALL YOU NEED TO KNOW ABOUT PROPERTY INSOLVENCY

Property related insolvency refer to cases in which

One party become unable to pay off its debts either because the assets are not enough to cover the expenses or,

The value of the assets have depreciated below the value of the liabilities.

What Causes Property Insolvency?

1 Market Conditions

This occurs when companies fail to anticipate changes in the market and do not adapt accordingly. This results in an erosion of profit margins that makes it difficult for them to pay liabilities.

2 Increase In Overheads

Happens where companies have incurred considerable expenses due to expansion and an overall increase in overhead costs that diminishes their profits and earnings.

3 Fraud

Companies can unknowingly enter into fraudulent contract terms and partnerships that result in financial losses.

4 Poor Management

These may involve the failure to keep accurate accounting and track of expenses, insufficient information for making key business decisions, or the lack of skills or equipment investment.

Whab Happens Next?

When a person or company becomes property insolvent, then 2 things are ensured,

Firstly, there should be no further increase in liability

And secondly, there should be no further devaluation of assets

Therefore, the assets will then be acquired by an insolvency practitioner for the just distribution of liabilities among all creditors.

Looking For An Involvency Practitioner?

WEMBLEY SOLICITORS

Wembley Solicitors can provide detailed legal guidance and support in helping you understand the implications of each legal route you take and for facilitating the legal process as smoothly and quickly as possible.

Call Us Now For Friendly & Expert Advice 02034173700

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