2006-09-02 23:34:43 · 7 answers · asked by younas 2 in Business & Finance ➔ Other - Business & Finance
basically it happens when a person or a business gets into too much debt, and are unable to pay the debts, therefore have to file for bank ruptcy. The debts that are owed, are not paid, and the debtors are notified that the person/business has filed for bankruptcy. This means that the person/business will no longer be eligible for finance loans etc.... It's not a good thing to have on your credit rating history!!
2006-09-02 23:43:59 · answer #1 · answered by Anonymous · 0⤊ 0⤋
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 the means available for payment.
Bankruptcy allows debtors to resolve debts through the division of non-exempt assets among creditors. Additionally the declaration of bankruptcy allows debtors to be discharged of most of the financial obligations, after their non-exempt 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. The creditor will not be permitted to continue lawsuits, garnish wages, or contact the debtor by phone to demand payment.
2006-09-03 06:37:02 · answer #2 · answered by redcar_racer 2 · 0⤊ 0⤋
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 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.
2006-09-03 06:37:12 · answer #3 · answered by Anonymous · 0⤊ 0⤋
bankruptcy is a way of clearing your debts via a county court, it costs money to do it but is different in each city, it should only be considered when your debts are very high and you dont have enough money to pay them, it also stays on your credit record for a year and you could have an attachment of earnings put into your wages for up to three years, if you are on benefits you may get your court costs reduced or free. *please note* if you own your home or have Hp on a car then you could lose these items through repossesion.
2006-09-03 06:40:11 · answer #4 · answered by kevin 2 · 0⤊ 1⤋
http://www.law.cornell.edu/wex/index.php/Bankruptcy
2006-09-03 06:43:37 · answer #5 · answered by nice guy 5 · 0⤊ 0⤋
It is when you cannot pay your debts.
2006-09-03 06:42:06 · answer #6 · answered by child_of_the_lion 3 · 0⤊ 0⤋
when you have no money at all.
2006-09-03 06:36:39 · answer #7 · answered by braddingsarah 2 · 0⤊ 0⤋