Here’s a quick rundown of some of the words you’ll come across when it comes to Insolvency. Some of these words are only ever used in legal documents and solicitor’s offices (some, quite frankly, sound a bit medical).
Liabilities
The state of being legally responsible for something.
Liquidation
The process of winding down a business.
Floating charge
A way for a company to borrow money.
Solvent
Means you have enough money to pay your debts.
Insolvent
Means you don’t have enough money to pay your debts.
DISCLAIMER: This article should not be regarded as constituting legal advice in relation to particular circumstances. This article is merely a general comment on the relevant topic.
Published on 8th March 2013
(Last updated 7th May 2021)