Compassionate Bankruptcy Lawyers To Guide You To A Fresh Financial Start

Bill Collectors Won’t Stop Calling? Bankruptcy’s Automatic Stay Can Stop Creditor Calls

On Behalf of | Sep 21, 2016 | Firm News

One of the absolute worst and most embarrassing parts about falling into debt are the frequent and insistent calls by creditors and collection agencies. These calls may be made to your home, cell phone, or even your work. In fact, some potential clients come to our offices after experiencing the embarrassment of a bill collector’s call to their office or workplace. Many people, a single call is mortifying. For others, what seems like frequent calls can, in time, begin to feel like harassment. You may begin to believe that these calls are affecting your mood, confidence, and professional career. If you have concerns about your bankruptcy petition, contact a Sacramento bankruptcy lawyer of The Bankruptcy Group.

The good news is that one aspect of the bankruptcy code can make most collection attempts and activities cease immediately. Bankruptcy’s automatic stay can put a stop to these calls and prove you breathing room to collect your thoughts and come up with a plan to address the debt. For many, the constant stream of creditor calls can result in a feeling of loss of control. Bankruptcy’s automatic stay is often the first step in taking back control over your finances and fixing your debt.

The Automatic Stay Stops Most Creditor Calls and Letters

Regardless of whether creditors and collections agency representatives are attempting to collect on alleged debts via phone, mail, or other means, the automatic stay can put an immediate end to most attempts. The automatic stay is set forth in 11 USC Section 362. The automatic stay prohibits most attempts to collect on alleged debts including “the enforcement, against the debtor or against property of the estate, of a judgment obtained before the commencement of the case under this title.” Essentially, the automatic stay requires creditors to pause their collection attempts while the matter is brought under the purview of a bankruptcy court. The automatic stay can provide benefits for an array of concerns including:

  • Stopping foreclosure – The automatic stay through an emergency bankruptcy filing is often a key step in stopping a foreclosure. A Chapter 13 bankruptcy petition can allow you to keep your home and provide additional time to catch up on mortgage arrears.
  • Stopping eviction – In certain situations, bankruptcy’s automatic stay can stop an eviction from a home. However, the stay is often brief and landlords can take action to get a court to lift the stay.
  • Stopping utility shut-offs – Bankruptcy’s automatic stay can also provide relief from threatened shut-offs of gas, water, or electricity.  It is not always appropriate to file bankruptcy to stop a utility shut-off and other relief may be available, but it is an important potential tool to be aware of.

While the relief provided by the automatic stay is not permanent, it is typically extremely welcome. The automatic stay is an immediate, albeit temporary, benefit that helps bankruptcy filers achieve a fresh financial start.

The Automatic Stay Is Only One Aspect of a Comprehensive Bankruptcy Plan

It is essential to note that by itself the automatic stay will only provide temporary relief. IN order for the debt and financial situation to be fully resolved, it is highly likely that the individual will need to obtain a Chapter 7 or Chapter 13 bankruptcy discharge. A bankruptcy discharge is granted at the completion of a bankruptcy filing. Generally, all debts and liabilities must be included in a bankruptcy petition to receive a discharge. Debts that are mistakenly not included in the petition will not be discharged and thus the debt situation would remain. Therefore it is essential to take a meticulous and painstaking approach to all bankruptcy filings.

However, provided that all dischargeable debts are included and the filer meets all other requirements, The discharge will eliminate or wipe away all eligible debt. Thus, while the automatic stay provides immediate relief, it is the bankruptcy discharge that resolves the underlying root of the problem.

Work with a Sacramento Bankruptcy Attorney in California Today

Facing a constant stream of creditor calls can make a difficult debt situation feel unbearable. Bankruptcy can provide both short-term and long-term relief from serious debt problems. To schedule a confidential consultation with an experienced bankruptcy attorney, call The Bankruptcy Group at 888-710-4334 today.