Bankruptcy
Bankruptcy is a legal process that allows individuals and businesses to eliminate or restructure their debts. It is a way for debtors to get a fresh start and to reorganize their finances. Bankruptcy is a complex process that involves filing a petition with the court, attending hearings, and working with creditors to reach an agreement. Depending on the type of bankruptcy, debtors may be able to keep some of their assets, such as their home or car, while eliminating other debts.
History of Bankruptcy
Bankruptcy has been around for centuries, with the first recorded bankruptcy laws appearing in ancient Rome. In the United States, bankruptcy laws were first established in the late 1700s. Since then, the laws have been amended and updated several times, most recently in 2005 with the passage of the Bankruptcy Abuse Prevention and Consumer Protection Act. This act made it more difficult for individuals to file for bankruptcy, but it also provided more protections for creditors.
Comparison of Bankruptcy Types
| Type of Bankruptcy | Eliminates Debts | Keeps Assets |
|---|---|---|
| Chapter 7 | Yes | No |
| Chapter 13 | Yes | Yes |
Summary
Bankruptcy is a legal process that allows individuals and businesses to eliminate or restructure their debts. It is a way for debtors to get a fresh start and to reorganize their finances. Depending on the type of bankruptcy, debtors may be able to keep some of their assets, such as their home or car, while eliminating other debts. For more information about bankruptcy, visit the websites of the U.S. Department of Justice, the American Bankruptcy Institute, or the National Association of Consumer Bankruptcy Attorneys.
See Also
- Debt Relief
- Debt Consolidation
- Debt Negotiation
- Debt Management
- Debt Settlement
- Foreclosure
- Repossession
- Credit Counseling
- Loan Modification
- Chapter 11 Bankruptcy
