In its most basic form, a debtor is a person who owes someone else money. A creditor is the person who is owed money. For example, If John loans Mary fifty dollars, then John is the creditor of Mary, and Mary is the debtor or John. While no debtor is guaranteed a total discharge of his debt, most debtors who file for bankruptcy are given such relief. One of the primary purposes of the bankruptcy act is to relieve the honest debtor from the weight of oppressive indebtedness and to provide the debtor with a fresh start.
Any person can file for bankruptcy protection from creditors.
In addition, most businesses and charitable organizations may also qualify for bankruptcy protection. As soon as your case is officially filed with the court, creditors are legally prevented from attempting to collect on any debt owed to them by you. A discharge is a total release of a debtor from any further personal liability for his or her pre-bankruptcy debts. In a rehabilitation case, creditors look to future earnings of the debtor, not to the current property of the debtor. Under rehabilitation, a debtor will generally retain his assets and property, while making payments to creditors pursuant to a court approved plan.