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Will bankruptcy stop garnishment, foreclosure, creditor calls, repossessions, or lawsuits?

Bankruptcy's Automatic Stay Stops Collection Actions

When you file for bankruptcy, the court issues what is known as an automatic stay, which is an order for all collection actions to stop.

Actions that must stop include:

  • Creditor lawsuits
  • Repossession
  • Foreclosure
  • Utility disconnections
  • Wage garnishments
  • Evictions
  • Other attempts by collection agencies to collect debts

If you are facing the possibility of losing your home or car due to missed payments, filing for bankruptcy can put a freeze on things while you figure out your finances. 

Stop Creditor Calls

In addition to stopping collection, you can also stop constant harassment from creditors. Hiring an attorney can stop creditor calls immediately, even before your bankruptcy has been filed. By federal law, they are not allowed to contact you in any way after they are properly notified that you are represented by an attorney.

What Cannot Be Stopped by Bankruptcy?

Although filing for bankruptcy does provide many benefits, there are certain things that the automatic stay cannot prevent. 

  • Child support or alimony actions - You are still obligated to pay child support and alimony, and these will not be discharged in bankruptcy 
  • Criminal proceedings - Any criminal penalties or fines will still be required
  • Certain tax proceedings such as an IRS audit or tax assessment

It is always a good idea to talk to an attorney to go over what to expect in your specific case. 

Interested in Filing Bankruptcy?

With the help of an attorney, you may even be able to get back money that was garnished before bankruptcy or your car that was repossessed before filing.

But time is crucial in cases like this--do not wait. Call our office today if you need this kind of relief.

We have offices in Springdale, Rogers, and Fayetteville for your convenience. Your first visit is free.