At the time you file a Chapter Seven petition for personal bankruptcy, what is known as an 'automatic stay' goes into effect, and you're immediately discharged from paying on all debts, except those that the Bankruptcy Code states are non-dischargeable. There are several categories of non-dischargeable debt, so keep in mind that it's likely that ALL your debts won't be erased. After the petition is filed, the court sends a notice of bankruptcy to all creditors listed in your court papers. To receive payment on their debts by the bankruptcy court, the creditors must file a 'proof-of-claim' form with the court and attend a 'meeting of creditors,' at which your creditors are allowed to question you about your finances. A trustee is appointed to collect and sell all the property in your estate that is nonexempt. After paying all administrative and court fees, the proceeds from the sale are paid out to your creditors in an order specified in the bankruptcy code. Once the money is paid, and there are no successful objections to discharge, the case is closed by the court. To find out how your debts would be affected by filing Chapter Seven bankruptcy, contact a bankruptcy attorney.