Consider filing for bankruptcy or insolvency only as a last resort.
Insolvency is not a legal panacea that will solve all debt problems. It has a long-term impact on your credit-worthiness. There are some debts that are not affected by the discharge of the insolvent. The following debts are not released by a discharge in bankruptcy: assessments due to the national and local governments, debts due to fraud embezzlement or defalcation by the debtor, debts with another where he is bound solidarily, alimony, corporate debts and debts not included in the schedule submitted by the insolvent debtor. Some strange occurrences have happened to some insolvent persons that have resulted in a large windfall to their families. It may seem that a man, even if insolvent, should be able to secure some protection for his wife and children by insurance. The old statutes in some American states allow this but they limit the amount that may be provided at the expense of creditors.
Tags: Property