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The city of Stockton, California, is eligible for bankruptcy protection, a federal judge has ruled. The ruling rejected creditors' arguments that the city was not truly insolvent when it sought protection and failed to seek pension concessions.

The city fully paid its obligation to California's retired workers pension system, but imposed losses on bondholders and bond insurers, reports Reuters.

Stockton will now be permitted to file for Chapter 9 bankruptcy, making it the largest U.S. city ever to file for municipal bankruptcy. But what is Chapter 9, and how will it affect residents?

A debt collector's job is to bother people until they pay a debt. No wonder they have a reputation for harassment.

It's certainly not pleasant to receive a call from a debt collector, but collectors aren't supposed to make the process worse. The Fair Debt Collection Practices Act (FDCPA) is designed to ensure that collectors don't harass people in debt.

Of course, even a single call from a debt collector can feel like harassment, so the FDCPA lays out guidelines to specify what is permitted. Here are 10 tips to keep in mind:

Bankruptcy. For those who have only heard the word without more, it can mean many things.

Some equate it with poverty. Others think of it as a fresh start. The truth is that many people don't fully know what bankruptcy is all about. Yet more than 1.2 million Americans filed for bankruptcy in 2012, according to the federal court system.

Whether it's affecting you, a friend, or a loved one, here are three things to know about bankruptcy:

It's official: Hostess will not be restructuring its bankruptcy. On Friday, the company asked a bankruptcy judge for permission to liquidate its assets, CNNMoney reports.

Twinkie lovers across the country are lamenting the news that their beloved cream-filled snacks may soon be unavailable. The decision to close the brand for good came after months of negotiation between Hostess and a major union were unsuccessful, according to Reuters.

This is a hard time for fans of Ding Dongs and HoHos everywhere, and we're here for you in your hour of need. Below, we've answered some of the questions the Hostess-bereft are probably asking themselves:

The honorable move for a debtor may be to pay off all the debt the incur. But while this may be the honorable move, paying off your debt may isn't always the best move (see some short sales/foreclosures).

This is especially true for seniors who have the option of filing bankruptcy and can withstand the hit to their credit score, The Wall Street Journal reports.

A Kansas couple was saddled with six-figure debt on 13 credit cards, reports The Journal. The husband was diagnosed with Alzheimer's and was unable to continue working full-time.

Faced with mounting debt and an inability to pay, the wife took on an additional evening cleaning job and launched an Avon business. The husband continued working 30 hours per week despite his illness, and they were able to work on repaying their debt.

The decision to declare bankruptcy is never entered into lightly but one of the drawbacks that isn't often considered is the long term effects.

Declaring bankruptcy is by no means a quick fix. It's a complicated process and requires a lot of paperwork and time going through the proceedings. But several years after the case closes you can hope to have put the debt behind you and moved on.

Not so fast. That dream does come true in some ways, but the decision to declare bankruptcy will follow you for a long time.

If you're facing overwhelming debt, you may be considering filing for Chapter 7 bankruptcy.

Chapter 7 bankruptcy is a solid option for many, as it can give you a "fresh start," erasing the obligation to repay and giving you a chance to get on with your life.

However, just because you can eliminate your debt with a Chapter 7 bankruptcy, doesn't necessarily mean it's the best option for you. You may also want to look into an alternative like Chapter 13. 

Let's look at when Chapter 7 may be right for you and when it may not be.

American Airlines made waves this week when the company filed for Chapter 11 bankruptcy protection. The company said the move was spurred by high labor costs and the downturn in the economy.

The airline hasn’t been the only one hit with high costs and financial instability from its high pension cost. Carriers like American have also had a difficult time competing against discount airlines.

However, many individuals are not particularly familiar with Chapter 11. What exactly will happen to the company in the process?

Jefferson County, Alabama, has filed for Chapter 9 protection in the biggest municipal bankruptcy in U.S. history.

Jefferson County is the most populous county in the state, with 660,000 residents. It's also home to the state's economic powerhouse, Birmingham.

County commissioners voted 4-1 for the bankruptcy after a September deal over the $3.14 billion deficit fell apart. The commission says it was because creditors refused to agree to economic concessions. The effects of the Chapter 9 filing may be felt by ordinary consumers.

Do you know how to consolidate your student loans? Need some student loan consolidation advice?

Consolidating loans can be a good way for students to handle mounting debt. It can result in one payment per month, or result in a lower interest rate. What are some tips on how to consolidate your student loans?