Bankruptcy Law

Bankruptcy Law Information

What is Bankruptcy?

Bankruptcy is a legally declared inability or impairment of ability of an individual or organization to pay their creditors. A declared state of bankruptcy can be requested or initiated by the bankrupt individual or organization, or it can be requested by creditors in an effort to recoup a portion of what they are owed. However, in the overwhelming majority of cases, the bankruptcy is initiated by the "bankrupt" individual or organization.

Purpose of Bankruptcy

The primary purpose of the laws of bankruptcy are: (1) to give an honest debtor a "fresh start" in life by relieving the debtor of most debts, and (2) to repay creditors in an orderly manner to the extent that the debtor has property available for payment.

Bankruptcy allows the debtor to resolve his debts through the division of his assets among his creditors. Additionally the declaration of bankruptcy allows debtors to be discharged of most of the financial obligations, after their assets are distributed, even if their debts have not been paid in full. During the pendency of a bankruptcy proceeding, the "Debtor" is protected from extra-Bankruptcy action by creditors by a legally imposed "stay." of legal issues.

• Bankruptcy Law News

For more free legal information on Bankruptcy Laws, please use the links below:

• Bankruptcy Proceedings

• Chapter 7 Bankruptcy

• Chapter 11 Bankruptcy

• Chapter 12 Bankruptcy

• Chapter 13 Bankruptcy

• Bankruptcy Abuse Fraud