A fundamental objective of federal bankruptcy laws enacted by Congress is to give debtors a new financial start from onerous debts.
bankruptcy law provides for thereduction or elimination of certain debts and may provide a schedule for the repayment of unliqu
A fundamental objective of federal bankruptcy laws enacted by Congress is to give debtors a new financial start from onerous debts.
bankruptcy law provides for thereduction or elimination of certain debts and may provide a schedule for the repayment of unliquidable debts over time. It also allows individuals and organizations to pay back guaranteed debt. Secured debt is generally a debt with real property or personal property, such as vehicles pledged as security, often on more favorable terms for the debtor.
Bankruptcy law has two central objectives. First, bankruptcy law seeks to free debtors from certain obligations they cannot pay by providing them with a “fresh start” from financial difficulties. At the same time, bankruptcy law seeks to preserve the compensatory interests of creditors and other interested parties by maximizing the total return of creditors in an orderly and efficient manner. Congress and the courts have established a complex system of statutes, procedural rules and judicial precedents aimed at balancing these competing interests.
Various types of debtors, from individual consumers with modest incomes to larger multinational companies, may struggle to pay their debts. To accommodate the different needs of such debtors, the Bankruptcy Code, which is the primary source of bankruptcy law in the United States, contains