What is bankruptcy?

Bankruptcy is a court procedure that allows people to wipe out (“discharge” is the legal term) certain debts they owe, such as credit card balances, loans, contracts, rental agreements, mortgage loans, overdue utility bills, and other types of debts. It also can help people to get caught up on certain debts and keep property, such as a house or motor vehicle, and it can stop many types of lawsuits and legal procedures such as garnishment against a person. It can be an excellent way for a person to get rid of debts and legal proceedings that are destroying their life and obtain a fresh start.