Liquidation Bankruptcy

Liquidation bankruptcy, often referred to as Chapter 7 bankruptcy in the United States, is a legal process for individuals or businesses unable to pay their debts. In this process, a court appoints a trustee to sell the debtor's non-exempt assets to pay creditors. After the sale, most remaining debts are discharged, meaning the debtor is no longer legally obligated to pay them. This type of bankruptcy allows for a fresh financial start but can significantly impact the debtor's credit rating and financial future. It's usually a last resort when other debt relief options fail.