Automatic Stay, Your Umbrella of Protection
In almost every case, a debtor needs relief from one or more creditors, either they are being garnished, or they are receiving harassing calls, or have been served with lawsuit papers. In every instance upon filing of a Chapter 7 all creditor actions or activities must stop!
These are the most common types of creditor issues most people have;
Garnishment of Their Wages
Garnishment of Their Tax Refunds
Seizure of Their Bank Accounts
Seizure of Their Personal Property
Repossession
Foreclosure
Lawsuits
License Restoration Issues
General Creditor Harassment
Most people are extremely tired of the harassing phone calls that come at every hour of the day and night including weekends. The filing of a Chapter 7 triggers the Automatic Stay, the fancy word for the protection you get from the Judge and the Bankruptcy Laws, your creditors are prohibited from doing any of the things listed above, and that protection is absolute! If wages are being garnished, upon filing, it must stop, if tax refunds are being intercepted, upon filing, it must stop, if property was seized, must be returned, the creditor has no choice.
Under
Chapter 7, if a creditor ignores the notice of filing of the case and decides
to continue with one of the actions above that creditor can be sanctioned by
the court, and made to pay your costs and fee’s if they do so in a malicious
fashion after being duly informed of the bankruptcy case.
Even after a case has been discharged and closed, debtors still need to be aware of their financial situation and their credit reports. Bankruptcy will eliminate the debt that a debtor owed, however, it does not clear up mistakes on a credit report or eliminate those creditors from a credit report. There is a distinct difference between the discharge of debts and the creditor falling off of that credit report. Once a debt is discharged a creditor should not continue to report that debt as delinquent or in default. Continuing to do that is a violation of the discharge order, and could be construed as a collection activity. What an account should say is something to this affect, “discharged” or “discharge in bankruptcy” or the like.
A discharge forever bars a creditor from trying to collect that debt. There is no amount of time that can pass where that debt comes back and can become collectable again, there have been known to be scams out there where companies have resurrected old discharged debt and attempted to collect many years after a case is closed and discharged. That is something debtors need to be aware of.
Law Office of Charles L. Basch II
100 Kercheval, Suite D
Grosse Pointe Farms, Michigan
1-877-343-9930