The Automatic stay may stop foreclosure, repossession, lawsuits and creditor harassment
When a person files for bankruptcy relief, they receive immediate protection from creditors through a special court order known as the bankruptcy automatic stay. In this case “Stay” means stop, as in “stay put.” CREDITORS MUST stop COLLECTION EFFORTS or face the consequences.
The Bankruptcy Automatic Stay Will:
- HALT Foreclosure
- STOP Repossession
- SILENCE Creditors
- STOP Lawsuits & Wage Garnishments
The Bankruptcy Code protects you by force of the automatic stay provision. With very limited exceptions, this “Stay” prohibits all collection activity after filing bankruptcy. The automatic stay stops any lawsuit filed against you and almost any other action against you, your property and your paycheck. It can even give you relief from pesky contracts you may have stumbled into.
This means that if a creditor attempts to collect a bill they are in violation of the courts and could be prosecuted. Phone calls, letters, attempts to foreclose or repossess property are all types of collection.