How does it work when a debtor has substantial wealth?
A. In most cases the debtor has a large portfolio of good assets with one in trouble, usually investment real estate for which they have signed a note with a personal guarantee. Imagine they have been supporting the bad property for years and have had enough. They may buy back their guarantee at a discount or give the bank a deed in leiu of foreclosure with a plan to pay only some of the deficiency.
