If a company goes into Chapter 7 bankrutpcy, does my stock or bond have any value?


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company chapter business bankruptcy

If a company goes into Chapter 7 bankrutpcy, does my stock or bond have any value?

If you hold stock of a company in Chapter 7, usually, but not always, the stock is worthless and you have lost the money you invested. If someone approaches you with an offer to buy it from you, that may be a tip off that yours is one of the unusual circumstances.

If you hold a bond, you might only receive a fraction of its face value. It will depend on the amount of assets available for distribution and where your debt ranks in the priority list. If your bond is secured by collateral, your payment will depend in large part on the value of the collateral.

(Reviewed 11.10.08)

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