Business & Finance Bankruptcy

How the Bankruptcy Automatic Stay Can Help End Your Financial Nightmare

Anyone who has been burdened with excessive debt knows the stress involved when creditors contact you day after day demanding payment.
Is there any way out of this mess? Well, one legitimate option that you should consider if you simply can't pay all your bills is bankruptcy.
The automatic stay provision in bankruptcy prevents creditors from trying to collect a debt after you have filed for bankruptcy.
Automatic stay is one of the most powerful and reassuring provisions of bankruptcy.
Once you file for bankruptcy, there is an automatic court order which prevents companies from taking any further action against you until your case is resolved.
Creditors cannot repossess your car, or begin foreclosure proceedings on your house, or try to garnish your wages through your employer.
Believe it or not, the creditors are not even allowed to contact you once you have filed for bankruptcy.
If they do, they'll have to answer to the judge and will probably have to pay fines as a result.
Now, you still have to go through the bankruptcy process, of course.
The automatic stay is a temporary provision that protects you from bill collectors.
Whether you have to pay any of your bills in the future depends on the outcome of your bankruptcy case.
But you definitely have at least a temporary reprieve from having bill collectors harassing you all the time.
You may be wondering about the new bankruptcy law and whether it has become more difficult to declare bankruptcy.
Well, it has become more difficult in the sense that you have to follow some additional procedures, but most people who end up filing will probably still be eligible.
Your bankruptcy lawyer can explain some of the specifics such as having to undergo credit counseling and attend financial management classes as a requirement for bankruptcy.
When it's all said and done, bankruptcy is still an option for many people to consider in order to achieve a fresh financial start.


Leave a reply