Most often when you think about
filing bankruptcy the process is completed by the debtor seeking protection. Yet, there
are special circumstances in which a debtor may not be able to file a
petition due to mental, physical, or financial challenges. It may actually
make sense for them to file bankruptcy, but they are unable to make important
decisions on their own; in other words they are not competent mentally
to go through such a process by themselves.
The good news is bankruptcy has special rules and regulations for incompetent
individuals. Meaning, they can have a designated person to help them file
their petition and proceed through the bankruptcy process on their behalf
(also referred to as Power of Attorney). Basically, the incompetent person
would have a representative such as guardian or conservator file bankruptcy for them.
The bankruptcy court can also appoint a representative for the incompetent
person if they do not have someone beforehand. Orders issued by the court
may also help protect interests of the debtor. Keep in mind, a Power of
Attorney who is granted the action of filing bankruptcy on behalf of the
incompetent person may have a higher chance of being granted an approval
by the court.
Sufficient conservatorship or guardianship for the incompetent person prior
to filing bankruptcy may increase chances for a successful outcome. If
bankruptcy is an option for your loved one or person of interest who is
incompetent, discuss options with an experienced bankruptcy attorney.