Bankruptcy Basics: What Is Bankruptcy?
By Brett Weiss, Maryland Bankruptcy Attorney on Feb 13, 2007 in General Bankruptcy Information
What is Bankruptcy?
To put it bluntly, bankruptcy is a legal way to avoid paying people what you owe them. Bankruptcy has biblical antecedents, however. Look at the “Jubile Year” and the forgiveness of debt in Deuteronomy. (For a more detailed discussion, see the article “Bankruptcy and the Bible.”) Since there is no Jubilee Year today, in many situations bankruptcy is the only way that you can keep your home from foreclosure, your car from repossession, your possessions from auction and creditors from making your life miserable.
When a person is discharged in bankruptcy, he or she is relieved from liability for most debts incurred before the bankruptcy was filed and protected from future collection of those debts. The purpose of bankruptcy is to give you a “fresh start,” and the bankruptcy code is interpreted by the Courts to give effect to these words.
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