Voluntary and involuntary bankruptcy
16/10/18 Voluntary and involuntary bankruptcy
In a voluntary bankruptcy, the debtor himself files a petition for liquidation proceedings (also referred to as “Chapter 7 petition”).
An involuntary bankruptcy occurs when the debtor’s creditors force the debtor into bankruptcy proceedings. If the debtor challenges the involuntary petition, a hearing will be held, after which the bankruptcy court will decide whether it will enter an order for relief or not.