The proceeds of the liquidation of the collateral are allocated to the creditor whose claim was secured by the collateral. If the proceeds exceed the claim, the excess is allocated to the next creditor in line whose claim is also secured by the same collateral. If no other debts are secured by the collateral, the excess is either distributed amongst other creditors or surrendered to the debtor.
In contrast, in bankruptcy proceedings all assets are liquidated and all creditors take part. However, secured claims also take priority in bankruptcy proceedings. In conventional enforced collection proceedings, only the creditors participate who initiated the proceedings within three months of each other.