Bankruptcy law is a federal law designed to assist individual consumers and businesses facing financial difficulties. People facing debt traps constantly face harassment by creditors.
The primary purpose of bankruptcy law is to give an honest debtor a "fresh start" in life by relieving the debtor of most debts and/or to repay creditors in an orderly manner to the extent that the debtor has property available for payment. During the pendency of a bankruptcy proceeding, the debtor is protected from harassment by creditors by a judicially imposed mechanism called "automatic stay." For more information on bankruptcy, click here.