Common Questions about Court Appointed Receiverships

Businesses go through ups and downs all the time. Lenders with interests in residential and commercial properties understand this. They also keep an eye out for those down times where they may need to protect their interest if a borrower is not handling the assets properly. When this happens, it’s vital to take action and request that a court-appointed receivership is established. The company appointed to enter the receivership acts on behalf of the court and takes over the day-to-day operations so that lenders and creditors can breathe easier.

4 Common Questions Regarding Receiverships

Entering into a receivership is often preferred over bankruptcy. It can bring a distressed or mismanaged property back from the brink of ruin and return it to profitability. Most don’t realize that this is an option to protect their interest. Here are the answers to four common questions asked about receivers:

1. What is a Court-Appointed Receiver? The courts choose a neutral third party to act as the custodian for the property of a company or individual. They have certain powers granted by the court, which can include taking legal control and protecting assets, filing claims, and distributing assets. They have the discretion to manage and liquidate the company’s assets and account for all receipts and payments of funds.
2. Who Chooses the Receiver? Commonly, a federal district court appoints receivers. The court is tasked with selecting a receiver. Therefore, the receiver only answers to the court.
3. What Types of Authority Does the Receiver Have? They are given authority that aligns with the court’s authority. Federal courts have specific powers and typically grant broad powers to receivers. Receivers are required to act in good faith and perform their duties with reasonable diligence.
4. Does a Receiver Get Paid and How? Receivers have a right to compensation for their services, including reimbursement for costs and expenses. Payment comes from the assets of the receivership estate based on an itemized report provided to the court. The court does have the final say on how much the receiver is paid.

Work with an Experienced Court Appointed Receiver

You may have non-paying tenants, poorly written leases, or buildings in dire need of restoration. You can breathe a sigh of relief when you learn that The Estes Group is the court-appointed receiver of your distressed property. We analyze the situation and work to handle business disputes, dissolutions, enforce judgments, and handle liquidations to ensure the best decisions are made for the property. Our ultimate goal is to preserve your investments.

We offer various services for real estate investors to build their portfolios. If you are looking for a broker that can help you with purchasing, managing, upkeep, and receiverships, look no further than The Estes Group. We can help you with your property throughout Mississippi, Tennessee, Alabama, and Louisiana.

Call us at 601-362-9633 or contact us online for help when you need a receiver for a court-appointed receivership in Mississippi, Tennessee, Louisiana, and Alabama.