In bankruptcy proceedings, creditors who do not have collateral pledged behind their debt will be paid only if there are funds remaining after other creditors have been paid.

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This is because in bankruptcy proceedings, secured creditors (those with collateral pledged behind their debt) have priority in being paid back before unsecured creditors. If there are funds left after the secured creditors have been paid back, then those funds will go towards paying back the unsecured creditors.

In Bankruptcy Proceedings, Creditors Who Do Not Have Collateral Pledged