Everyone knows about the dreaded phone call from a credit card company. The one where they call relentlessly asking for money. Creditors only care about one thing-getting their money. There is a way to stop these phone calls and letters. Declaring bankruptcy can help stop these calls immediately.
The automatic stay
When a person declares bankruptcy, an automatic stay goes into effect. There are several things that happen because of an automatic stay.
- Creditors must immediately stop contacting the debtor.
- Garnishes are stopped immediately.
- Debt collection lawsuits are stopped.
- Utilities cannot be shut off.
- Foreclosure and repossessions are stopped.
- Evictions are stopped.
- A driver’s license is returned if it was lost due to being uninsured.
There are some things that an automatic stay cannot do. These include:
- It does not stop criminal proceedings.
- It does not stop collections for child support or alimony.
- Tax audits and filing of substitute tax returns.
- 401K loans
The benefits of professional guidance
A legal professional who is skilled in bankruptcy can help their client get their life back. They understand how annoying it is to have endless phone calls from creditors. Filing for bankruptcy doesn’t just stop credit harassment it also gets rid of the debt that is causing a person to be harassed in the first place.
An attorney wants their client to experience a fresh financial start, one that is free of crushing debt. They will work with their client to understand their situation including the current value of their home with the outstanding balance on their mortgage, the amount of equity they have in their home, the amount of dischargeable debts including credit card and medical bills, and the assets their client wants to protect in the process.
They will also let their client know how bankruptcy will affect their financial problems and their financial future. They will make sure their client understands the process and what happens at each step. Declaring bankruptcy is not a failure, instead it is a way for a person to start fresh.