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Bankruptcy

/ˈbæŋkrʌptsi/

Meaning & Definition

noun

The state of being unable to pay debts owed, which can lead to legal proceedings to discharge those debts.

After losing her job, she unfortunately had to declare bankruptcy.

A legal status of a person or other entity that cannot repay the debts it owes to creditors.

The company went into bankruptcy after struggling with financial losses for years.

The condition of being bankrupt; insolvency.

His reckless spending eventually led to his financial bankruptcy.

Etymology

The word 'bankruptcy' derives from the Italian 'banca rotta,' meaning 'broken bench,' referring to the practice of breaking the bench of a banker who could not pay his debts.

Common Phrases and Expressions

file for bankruptcy

To submit a formal petition to a court for relief from debts.

bankruptcy court

A specialized court that handles bankruptcy cases.

bankruptcy protection

A legal provision that helps individuals or businesses manage their debts.

Related Words

insolvency

The condition where an individual or organization cannot meet their financial obligations.

creditor

A person or institution to whom money is owed.

debtor

A person or entity that owes a debt.

Slang Meanings

Going broke

He’s been going broke since his business failed.

Broke

After the expenses piled up, she was completely broke.

In the red

After paying bills this month, I’m really in the red.