When a borrower decides to declare bankruptcy, does that mean that the creditors get nothing? Bankruptcy is a legal way to eliminate debt, but what does that mean for the companies, organizations and individuals who loaned that person money in the first place?
Avoiding debt may, for some, be as simple as identifying why insurmountable debt happens and avoiding those risk factors. However, there are some factors you can't control, even with planning.
You may have heard people say that bankruptcy is one way to stop foreclosure. If they get the foreclosure notice in the mail, they assume they can just declare Chapter 7 or Chapter 13 to put an end to it.