Voluntary Bankruptcy Definition and Legal Meaning

On this page, you'll find the legal definition and meaning of Voluntary Bankruptcy, written in plain English, along with examples of how it is used.

What is Voluntary Bankruptcy?

(n). When the assets of a person is estimated to be insufficient to pay off his liabilities and the person is not in a position to clear his accrued liability, creditors can move to the court to attach the property for getting their payments after declaring him as bankrupt. If the person himself find incapable of meeting his liability he can move to the court requesting to declare his as bankrupt. Such filing of application is called Voluntary bankruptcy.