Debtor (entity in insolvency)

A debtor is an individual or entity that owes money to creditors and is unable to repay its debts. In the context of insolvency, this usually refers to a situation where the debtor's financial obligations exceed their assets, making them unable to pay bills as they come due. This can lead to legal proceedings, such as bankruptcy, where a debtor seeks relief from some or all of their debts. The process involves evaluating the debtor's financial situation and may result in a restructuring of debts or liquidation of assets to satisfy creditors.