When investing, it’s best to plan for the worst & hope for the best. If the investment goes south, a creditor who enjoys “priority” stands in a better position to recoup their investment. You can better position yourself with:
- Mortgage – or lien on real estate
- Attachment – court ordered lien on realty, bank deposits, receivables, or other assets
- Trustee process – court ordered lien on bank accounts or monies due to a debtor
- Equitable subordination – in certain circumstances, out of a sense of fairness, a court will permit one creditor to “leapfrog” ahead of another
- Bankruptcy – a trustee will work to retrieve assets for you and other creditors
- Mechanics’ lien – a lien on property to which you supplied labor or materials
Consult early with counsel about these & other remedies if you are concerned about protecting your rights to funds due to you.