Bankruptcy is a federal court process that places you under the protection of the bankruptcy court while you try to repay your debt or have your debt removed altogether. Once you file for bankruptcy, a automatic stay goes into effect. An automatic stay prohibits creditors from attempting to collect the debt that you owe without court approval. This is also the case when a bank is in the process of foreclosing on your house. Bankruptcy should be your absolute last resort. The ramifications of filing for bankruptcy are far reaching. Although filing for bankruptcy does not have the negative stigma it once did, it should not be taken lightly. Consulting a good bankruptcy attorney is critical when entering this decision. A bankruptcy attorney will take a look at al of your debts, financial obligations, and sources of income to determine what options you have. Remember that this is a big decision that could affect you well into the future. So carefully consider all of your alternatives. A bankruptcy can remain on your credit report for up to ten years.
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