Involuntary Bankruptcy

Last Updated: Jun 7, 2019

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When a person/business does not consent to file bankruptcy, they may be forced to declare bankruptcy through certain legal petitions made by its creditors. Bankruptcy code specifies the minimum number of creditors needed and amount of their claims to start the petition process. There are several differences between a voluntary and involuntary petitions. For example, with an Involuntary Bankruptcy a Company is not immediately placed into bankruptcy and the Company may continue to operate its business and use, acquire, or dispose of property. While Involuntary Bankruptcy is a lesser used tool by creditors, it is important to understand the process and procedures involved.