As you proceed through your bankruptcy after filing, you may have some questions about the automatic stay in terms of how it works and how effective it will actually be. After what may have been a prolonged period of time with creditors bothering you, it might be hard to believe that these guys will finally be off your back for a while, disregarding non-dischargeable debts like child support, alimony, and taxes. You may find that having the automatic stay go into effect is actually one of the more enjoyable sides of your bankruptcy!
Once you’ve taken the steps to file your bankruptcy, the automatic stay goes into place. This means that all of your creditors are notified, and then they are supposed to cease collections activity immediately. This does not apply to absolutely everyone as some secure creditors can ask for the stay to be lifted, but for the most part it does mean that if you’ve been getting phone calls, letters, and the usual amount of hoopla with everyone trying to collect on their debts—and not always being so pleasant about it–once they have been informed of your bankruptcy, nearly all of them will have to cease by law. The automatic stay is defined as “an injunction that automatically stops lawsuits, foreclosures, garnishments, and all collection activity against the debtor the moment a bankruptcy petition is filed.”
While it may seem that there is no excuse for a creditor who has been notified of your bankruptcy to continue making contact, very often it is a mistake due to the information not being entered into their systems or having been done so incorrectly. You can report these offenses, and if they are out of control you can sue creditors for damages after they violate the automatic stay.
The whole point of the automatic stay is to allow you to proceed through your bankruptcy smoothly, receiving your discharge and looking forward to that fresh start without being stressed and hassled. If you have questions about the steps involved in bankruptcy and which of your creditors the automatic stay will apply to, it’s a good idea to consult with an attorney at a law firm like Fitzgerald & Campbell, APLC where we have decades of experience in bankruptcy matters.