Insolvent is a term applied to the condition that a business cannot pay its debts or meet its obligations. It is based on the idea that the business should have sufficient assets to dissolve its liabilities. When a business is insolvent, someone who is owed will not collect on the obligation because the liabilities are greater than the assets. In certain situations the courts will distribute the assets of the insolvent business, whatever they are, proportionately. All who are owed will lose the same percentage and no debtor will suffer a single great loss so that others can collect in full.
The inability to pay debts as they fall due in the usual course of business or the inability of the debtor to pay current obligations as they become due. There is no requirement of insolvency in the Bankruptcy Code.
A term used to describe the negative financial condition of a person or business when they have an inability to pay their debts as they become due. A person is insolvent when their liabilities exceed their assets.
A company is insolvent if it has insufficient funds (all of its assets) to pay its debts (all of its liabilities). If a company's liabilities are greater than its assets and it continues to trade, it is not only insolvent, but in the UK, is operating illegally (Insolvency act 1986).
The 19th century equivalent of "bankrupt." For most of the 19th century no bankruptcy laws existed. When a debtor became unable to pay creditors, they could sue and the debtor could be adjudged insolvent. At this time debtors' prison existed in the United States; states did not begin to abolish it until the 1830s.
The word â€˜Insolventâ€™ is largely understood and scares a lot of people. They think that Insolvency is the same a bankruptcy. IT IS NOT. You are INSOLVENT when you cannot afford to repay your bills. In other words, if you have borrowed some money and you have contracted to pay an amount back each month, and you cannot afford to meet that payment you are technically insolvent: defined as â€œunable to meet your repayment obligations as they fall dueâ€. If you are paying pack minimum payments on your credit card because that is all you can afford you could be insolvent. SO WHAT? If you are insolvent there are a number of Insolvency solutions that legally become available to you; namely Bankruptcy or an IVA. Both these solutions solve your debt problem by effectively writing off your unaffordable debt, though, clearly, Bankruptcy is more extreme than an IVA.
If you dream that you are insolvent, you will not have to resort to this means to square yourself with the world, as your energy and pride will enable you to transact business in a fair way. But other worries may sorely afflict you. To dream that others are insolvent, you will meet with honest men in your dealings, but by their frankness they may harm you. For a young woman, it means her sweetheart will be honest and thrifty, but vexatious discords may arise in her affairs.