ABA Family Legal Guide

Consumer Bankruptcy

Introduction to Bankruptcy

The Process of Filing for Bankruptcy

What are the advantages of filing for bankruptcy?

By far the most important advantage is that debtors may obtain a virtually fresh financial start.

Another big advantage is that collection efforts must stop. As soon as your petition is filed an automatic stay takes effect and, by law, most collection activities must cease. If a creditor continues to try to collect the debt, the creditor may be cited for contempt of court or ordered to pay damages.