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Filing for bankruptcy is usually one thing we have a tendency to assume of as a voluntary act in New York. Head to a lawyer, offer documents and complete the process. But in terribly rare cases, creditors might band together and force you to file for bankruptcy.

1st, let me get one issue out of the approach – the possibilities of this happening depend quite a small amount on your situation. Involuntary bankruptcy cases sometimes involve businesses and people with important non-exempt assets, and are filed by creditors that are trying to a approach to get their hands on those assets.

I've got never seen a bunch of credit card corporations get together and force a consumer in New York to file for Chapter 7 bankruptcy. Ever. I'm not saying it can't happen, simply that I have never seen it yet. And remember, New York could be a huge place – if it's happens in the least, probabilities are pretty smart that it happens here.

Section 303 of the U.S. Bankruptcy Code governs involuntary bankruptcy cases, and provides that 3 or additional creditors with claims totaling at least $13,475 may file a Chapter seven or a Chapter 11 case against a person. I'm not going to urge into the business aspects of involuntary cases because I don't handle them as a general rule.

There are limitations on the type of claim {that the} creditors are allowed to possess against you, however the most vital one is {that the} claim can't be the topic of a valid dispute as to liability or amount. That means if you are being sued for a debt and are actively defending the claim during a New York court, the creditor cannot find two additional entities to gang up on you and file an involuntary bankruptcy case.

If your creditors file an involuntary bankruptcy case against you, the law permits you to continue using your property. After all, you can even sell it or provide it away unless the creditors request {that a} trustee be appointed to seize your assets. The court might require you to post a bond or other security to shield the price of the property.

If a bankruptcy case is filed against you by your creditors, you would like to require immediate action by filing an answer to the petition. If you don't then the court can simply move ahead with liquidating your property.

Before you panic, keep in mind what I said – involuntary bankruptcy proceedings against customers are very rare. If a New York involuntary bankruptcy case is commenced it's sometimes against a big-money person or corporation.

But if it ever happens to you, don't sit around – do something. Fast. Find more other FREE information about premier credit card, zero percent credit cards and travel credit card

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