What Is Bankruptcy?

Answering the question of, "What is bankruptcy?" can perhaps best begin by clarifying what bankruptcy is not.

  • It is not a ticket to debtors' prison.
  • It is not the ultimate sign of failure.
  • It is not the end of your financial world.
  • It is not immoral.
  • It does not mean that you must give up all your possessions.
  • It may not necessarily mean that you will give up your house or car.
  • We have never heard clients of Prescott Pearson & Tande, PA, who went through bankruptcy say it was the worst decision they ever made.
  • Although court records are accessible to the public if someone investigates you, your particular bankruptcy is not usually made public. Only your creditors, your attorney and the people you tell are likely to know about it.

What bankruptcy is to millions of stressed debtors can be described in a few succinct phrases:

  • Debt relief.
  • A fresh start.
  • A sensible financial decision under the right circumstances.
  • A legal solution to overwhelming debt as provided for by law.
  • An opportunity to have debts discharged and/or reorganized into an affordable repayment plan.
  • An ancient tradition dating from biblical days, when those who were owed debts were instructed to forgive those debts every seventh year.
  • A time-honored fiscal remedy that many well-known, successful Americans have resorted to, including Benjamin Franklin and Mark Twain.

When people are deciding whether bankruptcy is right for them, they often worry first and foremost about how to protect their assets, their reputation and their self-respect. They often harbor misconceptions about bankruptcy. They often think of bankruptcy as the ultimate badge of failure, and wonder whether there might be some other way to cope with overwhelming debt.

Some stressed debtors do find other ways to deal with crushing medical bills or out-of-control credit card bills, such as renegotiating terms with creditors. All too often, however, those other solutions turn out to be simply a way station on the way to a bankruptcy down the line — perhaps after they have already lost their homes to foreclosure, had their cars repossessed and plundered their retirement accounts unnecessarily. Meeting the problem of unmanageable debt head-on before the worst consequences develop can be a responsible approach.

"This Is All We Do, and We Do It Well."

Call Us for a Free Consultation

  • Minneapolis-St. Paul Area: 651-968-8096
  • Minnesota Toll Free: 888-366-0827

To learn more about your debt relief options, including Chapter 7 and Chapter 13, call or contact our bankruptcy lawyers today. We offer free initial consultations, quality services at competitive rates and effective representation statewide.

We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.