Bankruptcy and the Automatic Stay

The Automatic stay may stop foreclosure, repossession, lawsuits and creditor harassment

When a person files for bankruptcy relief, in most cases they receive protection from creditors through a special court order known as the bankruptcy automatic stay. This means CREDITORS MUST stop COLLECTION EFFORTS.

The Bankruptcy Automatic Stay May:

HALT Foreclosure
STOP Repossession
SILENCE Creditors
STOP Many 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.

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.