A person can be forced into involuntary bankruptcy if creditors petition the court to do so. A. True B. False

Question

Social Studies

Annalise Morse

4 August, 18:16

A person can be forced into involuntary bankruptcy if creditors petition the court to do so. A. True B. False

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Answers (1)

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Miguel Galvan · Answer 1

True

Explanation:

Bankruptcy is a legal proceeding involving an entity (person or business) which is unable to repay its' debts.

When declared bankrupt, the entity gets an automatic stay where creditors are blocked from collecting their debt.

The whole process is normally initiated by a debtor.

Involuntary bankruptcy is normally initiated by the creditors on unwilling debtors and the debtor is forced into bankruptcy.

Therefore, the above statement is true, a person can be forced into involuntary bankruptcy if creditors petition in court to do so.