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I am sorry to hear about this situation.
First of all, this all depends on how the owner financing contract is worded. It has less to do with statutory law, and more to do with the choices the contract gives.
If the owner financing contract ("contract") is worded that all the relief that the seller shall have is to take back the collateral, then there is nothing else that the seller can do but to take back the collateral. I doubt that the contract is that restricted, however. In a good contract, the seller can not only take back collateral, but may pursue the buyer for any sum left over that is not satisfied by the collateral (which would have to be appraised for worth and that worth applied to the sum owed).
Intellectual "knowledge" is not an asset. Meaning, it cannot be seized.
Assuming that the contract allows to pursue the buyer for whatever is still owed even after the collateral is seized, then the seller may with to:
1) take the business back
2) assess its value
3) apply that value to the money owed
4) and then pursue the buyer for the difference still owed
5) whether or not the seller continues to run the business or winds it down and simply begins a new one at this point under a different LLC is up to the seller and does not really affect the above.
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