2021 bankruptcy filing

A 2021 bankruptcy filing is when an individual or business formally requests legal protection from creditors because they cannot pay their debts. It involves submitting documentation to a court, which then may impose a plan to settle debts or erase some liability entirely. This process helps manage financial obligations and provides a potential path to rebuilding financial stability. The most common types are Chapter 7, which involves liquidation of assets to pay creditors, and Chapter 13, which sets up a repayment plan. Filing for bankruptcy can significantly impact credit and financial options but offers relief from overwhelming debt burdens.