Bankruptcy Defined

What is bankruptcy? The basic definition of bankruptcy is a legal process which is undertaken by a debtor (an individual or business entity) who is insolvent. The debtor is unable to pay his or her debts and thus places his or her financial affairs under the control of the bankruptcy court. In some cases, this means a liquidation of assets and property in order to pay creditors. It may also mean a special payment plan in order to help the debtor keep his/her assets.

Depending upon the specific situation, a debtor may file under a specific "chapter" of the bankruptcy code. For more information on specific types of bankruptcy, please click on one of the topics below:

To find a bankruptcy attorney in your area, click here.