What is an Automatic Stay?
Nobody wants to file for bankruptcy. Being behind on debts can be a humiliating experience, and having to seek legal help for such a matter can just make things worse. On top of that, you must deal with harassing phone calls from debt collectors.
The good thing is that once you file for bankruptcy, those annoying phone calls are supposed to end. Whether you file for Chapter 7 or Chapter 13 bankruptcy, an automatic stay is put into place. Legally, an automatic stay ends all forms of creditor harassment.
Automatic Stay Defined
An automatic stay is a provision under bankruptcy law. It tells debt collectors that you have filed for bankruptcy, so they need to leave you alone. It is now up to the bankruptcy court to handle your debts. This reprieve will give you some time to get your finances in order, see a lawyer and determine your next steps. In many cases, bankruptcy will be the best option, but there may be some other forms of debt relief to consider, as bankruptcy is a drastic option that can affect you and your credit score for a decade.
If the debt collector wants to continue trying to settle the debt, they must go to court. They can no longer go through you to attempt to receive any money. This means that they can no longer call you or send threatening letters. They cannot freeze your bank account, garnish your wages or put a lien on any property. They also cannot repossess a vehicle or foreclose on your home.
An automatic stay is a temporary action that remains in place as long as your bankruptcy case is open. This means that the collection activities may continue as soon as you close your case. However, keep in mind that a debt collector can lift the stay at any time, so there are no guarantees that you will be totally free of all forms of harassment. However, lifting a stay is not an easy process. First, there must be a hearing. The creditor must go to court and give good reasons as to why your stay should be lifted. They cannot sue or collect on your debt in any way without the court’s permission.
A stay is commonly lifted when secured debts, such as homes and vehicles, are involved. In order to keep these assets, you may be forced to get current on these loans. You may also be ordered to file for a Chapter 13 bankruptcy, which allows for a repayment plan.
It’s also possible that some of your debts may not be included in the bankruptcy. For example, student loans are often not wiped away in a bankruptcy, so you could still receive calls and letters from the lender during this time. Alimony and child support are also not included, so you could still be sued if you refuse to pay these debts.
Contact a Coral Springs Bankruptcy Attorney
If you’re planning to file for bankruptcy, it’s important to understand the laws involved, as well as what rights you have. This will help you better eliminate debt and avoid creditor harassment.
Contact a Coral Springs creditor harassment & debt collection attorney at the Law Offices of Barry S. Mittelberg, P.A. for help with the bankruptcy process. We can provide you with the debt relief you need. Schedule a free consultation today by calling (954) 752-1213.