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I know that all debts, including foreign debts, have to be declared when filing for bankruptcy in the US.

I am wondering what effect this has on foreign debts. My thinking is that it doesn't 'cancel' them, and they will still be valid in the country of origin, but they won't be able to be sued for or collected in the US.

Is this correct?

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A US bankruptcy establishes a plan to hold off creditors and protect some of your assets, for creditors and assets within the jurisdiction of that US bankruptcy court. Your assets in another location are probably not protected. Your creditors elsewhere would be bound by US law for their actions in the US, your assets in the US would be under control of the US court, but your assets outside the US (eg the bank account in Panama or the vacation house in Mali) would be subject to creditors acting under whatever local laws apply.

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  • Will bankruptcy protect foreign creditors attempting to collect US assets in the US for a foreign debt, if the foreign debt is declared in the US bankruptcy? Maybe that's a better way of phrasing my question. – David Randolph Oct 4 at 10:03

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