Can a Catholic in conscience declare bankruptcy, and if so can he consider his debts as forgiven?
Civil laws allowing the declaration of bankruptcy are just laws, enacted for the common good, for they enable a debtors creditors to be satisfied in as far as and just a manner as possible, and prevent his remaining assets from being squandered or wasted. They consequently oblige in conscience, insofar as they do not conflict with the natural law. Fr. Jone in his Moral Theology (p. 259) describes what is allowed by natural law: The natural law allows an insolvent person to retain what is required to modestly support himself and his family according to their social status and to establish a small businessTo retain more than this is an injustice and makes one subject to restitution Consequently, it is morally licit to declare bankruptcy, provided that it is truly impossible to pay ones creditors, and provided that one honestly declares all of ones assets. However, it does not necessarily follow from this that the debtor is freed from all obligation in conscience to make restitution to hi
