each creditor is then given out of his claim according to that same proportion.

6 – The interdiction is not lifted from the insolvent debtor unless he pays off his debt in full, or a judge rules to remove it—even if part of the debt still remains—for a judicial ruling while some of the debt is outstanding will only be issued after the judge has verified that his assets are exhausted and has considered which course is more beneficial: keeping the interdiction in place or removing it.

7 – It is permissible to give him zakat so that he can settle his debts.
The Hanbali jurists—citing the wording of the author of Nayl al-Maʾārib—state: “If someone goes into debt for his own benefit in order to buy something lawful or unlawful, then repents while he is poor, he is to be given what will enable him to repay his debt; the same applies when the debt is owed to Allah Most High.”

8 – When the judge has distributed whatever property he presently owns, all claims against him are suspended: the creditors may no longer accompany him, demand payment, or imprison him for the debt. Instead, he is left at liberty and granted time until he acquires new wealth, whereupon the creditors may take it. This does not mean that you are entitled only to what you have already received and that the remainder of your claims is nullified. Such is the purport of the hadith when read together with the Almighty’s words: “And if the debtor is in hardship, then grant him respite until ease comes” (Q 2:280).

Bankruptcy, therefore, does not extinguish the creditors’ rights; it merely prevents attachment and pursuit, for the Prophet ﷺ said to the creditors of Muʿādh: “Take whatever you find, and you have nothing beyond that.”