The bankruptcy cases in the United States are filed in bankruptcy courts in every county. The court follows a strict procedure in order to pass the bankruptcy orders.
Bankruptcy Order in the United Kingdom
The process of filing a bankruptcy petition is more or less same in the United Kingdom and US. In UK, the petitions for bankruptcy are generally filed at the London High Court or any other county court that is nearer to the residence of the bankruptcy petitioner. The petitioner pays a set amount of court fees and administration charges. After this, the court follows the bankruptcy process and at last the bankruptcy orders are passed by the court.
After the bankruptcy order has been made, an Official Receiver takes possession of the bankrupts’ property and works as a trustee of the estate. He or she also carries out the responsibility of informing several authorities and financial institutions about the bankruptcy order. Any person or institution that carries out any kind of transaction with the bankrupt are also informed about the order of the court.
Bankruptcy Order in the United States of America
In the United States of America, the bankruptcy petitions are filed under Chapter 7, 11, 12 and 13. Before filing the petitions, the debtor has to go through a “means test” to determine the Chapter under which the petition should be filed. Once the petitions are filed, the court appoints a trustee to carry out the process of bankruptcy. The trustee then arranges meetings between the creditors and the debtor. After that, the petitioners’ property is liquidated and the creditors are paid by that money. The court then declares the individual as bankrupt by issuing the bankruptcy order. When the financial condition of the bankrupt becomes normal, the court cancels its previous bankruptcy order.
Last Updated on : 10th July 2013