What does Filing for Bankruptcy do?

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asked Jan 6, 2017 in Other-Finance by Judy (58,130 points)
What does Filing for Bankruptcy do?

Why would someone file for Bankruptcy? And what does it do?

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answered Jan 6, 2017 by Mechanic21 (29,150 points)
A bankruptcy discharge eliminates debts, but it does not eliminate liens.

So, if you have a secured debt (a debt where the creditor has a lien on your property and can repossess it if you don't pay the debt), bankruptcy can eliminate the debt, but it does not prevent the creditor from repossessing the property.

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