Hi there, I am Aiden Muzzel. I am well versed in bankruptcy proceedings, so I would like to share my knowledge with you through my site. I started my adult years with minimal knowledge of money management. As a result, I ended up way over my head in debt. I was working two jobs and paying all of my income to the debt accounts without making a dent in the total. It turns out I was simply paying late fees and interest with my funds. I sought out legal representation to learn more about how bankruptcy could help me end the cycle and start over. My bankruptcy attorney helped me fill out paperwork, file documents and attend court proceedings. Within a year, the judge discharged the eligible debt accounts. I hope to explore bankruptcy in more detail on my website. I hope you come back soon to learn more.
One of the ways that you are protected during a bankruptcy filing is the automatic stay. However, the name alone does not tell you much about what the law actually does to give you the protection that you need. Here are a few questions you're likely to have about the automatic stay as you move forward with your bankruptcy case.
What Is The Automatic Stay?
The legal process known as the automatic stay prevents creditors from collecting debts that you owe while your bankruptcy case is being worked on. It not only protects you from paying back a debt that may be discharged, but it also prevents the creditor from harassing you about the money that you owe them. You also have protection from things like wage garnishment, having property seized, or a creditor filing a lawsuit against you. It can give you some much-needed mental relief while your lawyer helps with the legal proceedings to give you financial relief.
How Soon Does The Automatic Stay Take Effect After Filing For Bankruptcy?
The nice thing about the automatic stay laws is that they take effect as soon as you file the paperwork and make your bankruptcy official. You can immediately let any creditor know that you have an automatic stay in effect, and it will be considered their notification to stop contacting you regarding the debt. While there are some exceptions to this rule, it applies to most first-time bankruptcy cases.
What Happens If The Automatic Stay Is Violated?
You can actually sue a creditor for damages if they violate the automatic stay. You would have a pretty solid case for suing not only for the damages that they caused due to the violation, but for punitive damages as well. For example, if your car was illegally repossessed, you can sue the creditor for the value of your vehicle and up to the maximum amount that your state allows for punitive damages for the violation
What Happens Once The Automatic Stay Goes Away?
There will come a point where the automatic stay goes away, but it will be after your bankruptcy filing is complete. If a debt is discharged, then the creditor is not allowed to contact you regarding the debt because you do not legally hold it anymore. If the debt was not discharged, then the creditor can resume the process of contacting you for payment.
Contact a bankruptcy lawyer to learn more.
Share8 November 2021
