Frequently Asked Questions

A preference claim refers to payments made by a debtor within 90 days before filing for bankruptcy. Under Section 547(b) of the Bankruptcy Code, these payments can be legally recovered by the bankruptcy estate to ensure fair distribution among all creditors.

While the bankruptcy code does provide several defenses against preference claims, successfully arguing these defenses typically requires specialized expertise and can be costly. Even when defenses might apply, proving them in court often requires extensive documentation and legal proceedings. The cost of hiring bankruptcy counsel and litigating these defenses frequently exceeds the amount of the preference claim itself, with no guarantee of success. 

Our preference indemnity typically costs significantly less than debtor settlement offers. Once you purchase indemnity, your liability is capped at the purchase price – regardless of the final outcome in a settlement or court ruling.

No. Once you purchase preference indemnity, we formally notify the debtor and/or trustee that we have assumed the liability. All future communications and proceedings regarding the preference claim will be directed to 547 Solutions, and we will be responsible for any costs, fees and liabilities pursuant to the indemnity agreement.

Our business model is based on handling many preference claims efficiently through our expertise and established processes. While the outcome of each individual case varies – some may resolve for more than your indemnity cost, others for less – you are guaranteed a fixed cost regardless of the outcome. We take on all the uncertainty and risk of the legal proceedings, allowing you to move forward with certainty.

While it may seem unfair, bankruptcy law allows debtors to recover certain payments made shortly before bankruptcy to prevent preferential treatment of some creditors over others. This ensures all creditors are treated equally during the bankruptcy process.

Preference indemnity is our innovative solution that transfers your preference liability to 547 Solutions. For a fraction of the cost of typical settlement offers, we assume full responsibility for the preference liability, including any legal proceedings or settlements.

Yes. The transfer and assumption of liability from one party to another is completely legal under standard contract law. We properly document and notify all relevant parties of the liability transfer.

Nothing – we handle everything from there. Once you sign the agreement, we take over all communications with the debtor and manage any necessary legal proceedings. You can focus on running your business while we handle the entire process. We’ll notify all relevant parties that we’ve assumed the liability, so any future correspondence about the claim will come directly to us.

Our guarantee is straightforward and bound by standard contract law. The only limitation is that your preference indemnity contract must be valid – meaning you must accurately and completely represent the nature of your preference payment during our pre-contract communications.

For specific questions about your preference claim or our indemnity services, please contact our team directly.

201-266-6988

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