Can I Be Forced to File for Bankruptcy?

If you are struggling to repay debts you owe, and creditors are contacting you, you may be worried about the types of actions that creditors or debt collectors can take against you in order to recover the money you owe. You might be wondering, specifically, if you can be forced to file for bankruptcy. Involuntary consumer bankruptcies are not common, but they can happen under some circumstances. Our Oak Park bankruptcy lawyers can provide you with more information about involuntary bankruptcy, as well as details about your rights as a consumer under the Fair Debt Collection Practices Act (FDCPA) and other laws.

Understanding How Involuntary Bankruptcy Works

It is rare, but individuals can be forced to file for bankruptcy in limited circumstances through an involuntary bankruptcy petition. According to the U.S. Bankruptcy Code:

“An involuntary case may be commenced only under Chapter 7 or 11 of this title, and only against a person, except a farmer, family farmer, or a corporation is not a moneyed, business, or commercial corporation, that may be a debtor under the chapter under which such case is commenced.”

Typically, multiple creditors will come together to file an involuntary bankruptcy petition against a debtor who has not repaid debts. However, involuntary petitions usually only occur when the debtor has enough assets or income that the creditors believe an involuntary bankruptcy petition will allow them to recover debts owed. When just one creditor wants to file an involuntary petition, they must be owed a substantial amount of debt to be able to move forward with an involuntary petition.

You Have Rights as a Consumer

Individual debtors should know that they have rights under the FDCPA, and debt collectors cannot harass or make threats in order to try to force you to repay debts. While involuntary bankruptcies can occur in limited circumstances, it is important to keep in mind that it is not common for a creditor to move forward with an involuntary bankruptcy petition against an individual debtor. Furthermore, debt collectors cannot harass you or repeatedly threaten you with an involuntary bankruptcy petition if you do not make payments on a debt. In addition to prohibiting harassing behavior and threats, the FDCPA also prohibits debt collectors from lying and engaging in other deceptive practices.

While the FDCPA does not restrict a creditor’s ability to file an involuntary bankruptcy petition, it is important to know that you will have a chance to respond to an involuntary bankruptcy petition and to attend a hearing in the event that an involuntary filing does occur. Before you worry, you should seek advice from a lawyer who can assess your circumstances and provide you with more information about your options.

Contact an Oak Park Bankruptcy Attorney

Do you have questions or concerns about involuntary bankruptcy in Illinois? One of our experienced Oak Park bankruptcy attorneys can speak with you today about your case. Whether you need help with an involuntary petition that has been filed by creditors or you want to learn more about a voluntary bankruptcy filing under Chapter 7 or Chapter 13, one of our lawyers can speak with you today. Contact the Emerson Law Firm for more information.


See Related Blog Posts:

Chapter 13 Debt Limits Increase

Is Liquidation Bankruptcy Right for Me?

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