Personal bankruptcy

1 video
Back in the day (like medieval Europe), you would actually be thrown in jail if you couldn't pay your debts (debtor's prison). That seemed like a pretty awful thing to do (not to mention that lenders are much less likely to be paid by someone rotting in prison), so governments created an "out" called bankruptcy (which, as you'll see, is a pseudo-painful "reset" button on your finances).

Personal bankruptcy: Chapters 7 and 13

VIDEO 13:22 minutes
Chapter 7 and Chapter 13 personal bankruptcy.