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Where does the lender get this magic “get paid in full” option? Obviously if the lender has that option, they would take it. But they don’t. Even if they got a
by 4death4 3y ago
Where does the lender get this magic “get paid in full” option? Obviously if the lender has that option, they would take it. But they don’t. Even if they got a court order demanding wework pay out, that claim would get lumped in with all the other claims. You can’t just magically skip the line.
- gameshot911 3y agoOnly if they file for bankruptcy. I'm saying get paid in full via court order before they file for larger bankruptcy. If wework owes you $100M that you demand repayment on, and they owe $1B in total, they may not want to declare full bankruptcy just for your 10% of the total debt. In which case you can get a court order to be paid in full, since they was the terms of the original debt contract.
- 4death4 3y agoIf the debt is structured in such a way that the lender can demand payment in full at any time, then sure, that might work. But the vast majority of debt is not structured like that.
- gameshot911 3y agoI meant more so get paid in full whatever you're owed at that point in time. But you're right, sure you may get full payment on the 1/20th of a debt you're owed today, but if that puts the rest of the repayments at risk I can see why you'd want to negotiate.
- bryanlarsen 3y agoI've never seen loans of that size, but in my understanding a lot of debt is structured so that if a payment is missed the lender can call the entire amount.
- ballenf 3y agoAnd if you do the money gets clawed back in the bankruptcy that comes immediately after the company has handed over all their free cash.