What is a preferred transaction bankruptcy?

In the case of bankruptcy preferred transaction is one that tries to pay some creditors while that liabilities to other creditors be dismissed. This type of transaction is prohibited in certain circumstances. DefinitionWhile determine whether a given transaction is preferred can be difficult, it is a general rule. (Any payment to a creditor a debtor in the 90 days before filing a petition in bankruptcy of the debtor is a preferred creditor transaction.InsidersIf is an "Insider" to the debtor as a shareholder, Director and etc.), each payment to the creditor is in the year preceding the presentation of the petition in bankruptcy as a preferred transaction transaction.ProhibitedPreferred most banned bankruptcy of USA Code.PurposeBankruptcy allows a debtor reduce or eliminate debt creditor. Preferred transactions ban will prevent that all his money repay creditors it fosters a debtor that leave hold the bag.ResultsCreditors foreigners are allowed to "Preferred transactions of the debtor in bankruptcy to avoid" to spend. In practice of the beneficiary of the transaction return the divisions between the creditors.ExceptionsWhile trustee money Bankruptcy Code provides numerous exceptions from the general rule, a preferred transaction to stay there may be allowed, where it would cause other creditors less you get no in the absence of the transaction or the transaction payment represents the remuneration for a new value for the creditor instead of a previous debts.