Bankruptcy Code

The Bankruptcy Code is a set of federal laws in the United States that governs how individuals and businesses can handle insolvency, or the inability to pay debts. It provides a legal process for debtors to either restructure their debts, through a plan to pay creditors over time, or liquidate their assets to repay debts. The Code aims to provide a fresh start for those overwhelmed by financial burdens while ensuring fair treatment for creditors. Different chapters address various situations, like Chapter 7 for liquidation and Chapter 13 for debt reorganization.