Bankruptcy is a legal proceeding that is available to a person to cope with a financial crisis.
To go into bankruptcy it is necessary for a person to be insolvent. By law, all actions against a bankrupt must cease once the documents are filed. This does not apply to secured creditors such as banks holding, for example, a lien on a car. Any legal filing of a bankruptcy is a public document which the general public has access to. From this documentation, the Credit Bureau is notified and the bankruptcy is recorded and will remain on your credit record for 6 years.