What Is Bankruptcy?
Bankruptcy is a legal proceeding in which a person with debt problems can get a fresh start. Once you file a Chapter 7 or 13 bankruptcy, your creditors are legally prevented from taking action to collect on a debt. They cannot call you, bill you, threaten you, sue you, or do anything else to collect from you. They also cannot take property from you through repossession, foreclosure or garnishment.
Bankruptcy is a powerful remedy against your creditors. Rarely does someone want to file for bankruptcy protection. But it is important to understand that bankruptcy is an option. If you have debt problems, particularly with credit cards or overwhelming medical bills, filing bankruptcy can make a meaningful positive difference in your life.
Understanding bankruptcy and how it will affect you is a complex process. It is best understood by consulting with an experienced bankruptcy attorney.