---
title: Liquidation
description: When a business is unable to pay its debts, it may be liquidated. This means the business closes and its assets are sold. The money received for its assets is then used to pay its creditors. Most liqu
---

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# Liquidation

When a business is unable to pay its debts, it may be liquidated. This means the business closes and its assets are sold. The money received for its assets is then used to pay its creditors. Most liquidations result is less money being raised from the sale of assets than is needed to pay the creditors. In this case the creditors may only be paid a portion of the money they are owed.

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