Banckruptcy is not the only option
Being on a committee and dealing with a recalcitrant owner, who simply ignored efforts to discuss a payment/hardship plan (it being Covid 19 as well) forcing us to proceed with civil proceedings. The recalcitrant behaviour continued with him ignoring court hearings and summons, and the court was unable to do anything about it given it was a civil matter.
Going through this process and seeing the inadequacies and short comings of the process and protections offered to the OC regarding recovery of monies etc, being unsecured creditors and the court appointed trustee acting for the court, I was struck by how strong the call/advice was to force the bankrupty on an owner as the only option.
We postponed making a decision,and the risk of being unsecured creditors, allowing the debt to rollover at 10% interest, given the only guarentee of the money to be recovered would be on sale/reposession as long as the lender was formally notified, which made sense with some particular risks needing to be considered
Not forcing bankruptcy also kept open the possibility the owner could refinance and clear this debt given the 10% penalty being imposed with doing nothing.
Fortunately, he managed to refinance and the circa $40K debt (Levies, interest and legals) were recently paid in full, so it was a win-win in the end.