The bankruptcy laws were created in order to protect borrowers as well as their creditors.
Recent events worldwide have shown while it was common practice and too easy to borrow sums of money that would stretch the credit levels to the maximum, it was, in retrospect, not the wisest things to do.
The friendly and understanding finance companies who were prepared to lend this money, became a lot less friendly when, in many cases, the people who had taken advantage of this "not too many questions asked" form of easy borrowing began to find it difficult to meet their monthly payments.
With the increased realization that the bubble had begun to burst, their finance companies began to mount, and become increasingly aggressive.
Many hundreds of thousands of good people, who found themselves in this situation, were totally unaware how to handle it.
Many were ashamed and guilty, and were unaware of who to turn to under the barrage of unrelenting pressure and threats from their creditors.
Protection for the Borrower Because of the average man in the street's lack of knowledge and understandable fear of bankruptcy and its laws, most are reluctant to take this step.
They are unaware that this law was created exactly for people who find themselves in this position, and can offer them various levels of protection against their creditors.
Once a person declares that he is unable to meet his personal financial commitments, then he can decide to take the steps involved in declaring himself a personal bankrupt.
The immediate consequence of this action is that their creditors are disallowed by law under any circumstances to contact the borrower.
The best advice anyone can give to someone who considers taking the steps to declare bankruptcy is to contact a lawyer to advise them of the implications of such a step.
People who feel that they have made every effort to satisfy their creditors and repay their debts, and yet the creditors are unwilling to accept their proposals, only then should they consider bankruptcy as a serious option.
They should do so in the complete knowledge that the bankruptcy laws are there to protect them.
Many creditors, when they hear that you are considering declaring bankruptcy and who are well aware of the fact that bankruptcy laws are there to protect the borrower, will suddenly become much more flexible.
Declaring bankruptcy, to an extent, stops owing money being a personal issue and the courts become a mediator between the two parties.
It is still a step that should not be taken lightly as bankruptcy laws do have their share of short and long term ramifications, especially regarding the borrower's future credit ratings and status.
All in all, people who find themselves in a situation where their liabilities have exceeded their short term capabilities to meet their financial responsibilities should consider the protection of the bankruptcy laws as an option.
Sound advice is to do so under consultation of the many insolvency lawyers who can be readily found either online or through the local press.
The relief of the cessation of pressure from your creditors however should be tempered with the knowledge that until your debts have been paid off in full, and maybe for some time after,bankruptcy laws will mean that you will find it difficult or impossible to be granted any form of credit.