Petitioning for Bankruptcy

When an individual or organization is incapable of paying of debts, one option is to file for bankruptcy. A creditor can also file for the debtor to declared officially bankrupt. In petitioning for bankruptcy, the debtor or creditor must file an application to the judiciary court regarding bankruptcy.

A debtor, who is deciding to go bankrupt, must file a petition to the county court in his area. The court will require the petitioner to pay a certain amount deposit and court fee for the administration of the due process. Some judiciary courts can relinquish the court fees, except the deposit in petitioning for bankruptcy.

There are two forms of petition that must presented to the court in order to file for bankruptcy. The first form is the debtor's petition or Form 6.27. This form is intended for people with businesses, because they are the ones who usually file for bankruptcy.

In petitioning for bankruptcy, the debtor should approach the court in the area where he has conducted regular business in most of the past six months prior to the declaring of bankruptcy. However, not every county has a bankruptcy judicial court.

The second form that should be submitted to the court is Statement of Affairs or Form 6.28. This form contains general information regarding the petition. Guidelines, available in the form, should be followed in filling up the Statement of Affairs.

The first page of the form should contain the mortgage details and information on secured loans. The number of creditors should be alphabetically listed in the next page. This page also includes all the unsecured loans or debts.

The following page will state all the cash, assets, or valuables that can be taken in order to pay off most of the loans. The statement of affairs should also include possible solutions for the debtor to reach an agreement or negotiation with the creditor.

Also all the necessary information that is vital to decision of the court regarding the petitioning for bankruptcy should be in this form. Upon completion of the form, the debtor should bring to the judiciary court in order to be sworn in.

The debtor must also bring along the necessary fees needed, like the court fee and the deposit. The court will then take the matter to a district judge, in order to be decided if the petition should be heard in court. When a hearing of the case is necessary, the debtor appearance in court is compulsory.

The creditor can file a petition for bankruptcy of the debtor if owed more than a thousand US dollars. A number of creditors petitioning for bankruptcy of the same debtor can join together to meet the required amount.

The creditor can only file for bankruptcy of an individual or organization, if the debt is unsecured and the debtor is unable to provide payment. The debt can be arranged to be paid immediately or on an agreed time. The legal proceedings will be held in the judiciary bankruptcy of the debtor.

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