Difference between revisions of "Assignments in Bankruptcy"
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=== Going into bankruptcy=== | === Going into bankruptcy=== | ||
Debtors can go into bankruptcy in two ways: | Debtors can go into bankruptcy in two ways: | ||
* '''They may make a voluntary assignment in bankruptcy | * '''They may make a voluntary assignment in bankruptcy''': This process is started by the debtor.
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* '''They are forced into bankruptcy | * '''They are forced into bankruptcy''': A creditor can sometimes force a debtor into bankruptcy by filing a court action called a petition, and asking the court to declare the debtor bankrupt.
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The majority of consumer bankruptcies are started by voluntary assignments in bankruptcy. Creditors will only try to force debtors into bankruptcy when there are considerable assets available to be sold to pay creditors, and when creditors think they are not going to get any more money from the debtor through any other means. Petitions in bankruptcy are used much more frequently against businesses than individual debtors. | The majority of consumer bankruptcies are started by voluntary assignments in bankruptcy. Creditors will only try to force debtors into bankruptcy when there are considerable assets available to be sold to pay creditors, and when creditors think they are not going to get any more money from the debtor through any other means. Petitions in bankruptcy are used much more frequently against businesses than individual debtors. | ||