One of the advantages of bankruptcy is the freedomfrom any harassment or blackmail. When the debtor fails to pay his creditors,the latter will update the former on his debts, and usually, communicationbetween both parties will not be smooth. Filing for bankruptcy may minimize thestress suffered by the debtor.
Having a freshstart is another advantage of bankruptcy. It provides the debtor a chance to bedischarged from his debts. However, assets that have been used to secure debtswill be disposed by the creditor, and the proceeds will be applied to the debtif the debtor is unable to pay on the maturity date. Any remaining unsecureddebt will then be paid using the proceeds from the free assets. As soon as the debtor files forbankruptcy, the creditor will stop the collection of payments. The creditor maynot choose to violate this because he may face a court trial and may be penalizedor may be liable for damages.
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