The Automatic Stay Provides Relief in Texas Bankruptcy

Sometimes bankruptcy is the best solution for digging out from the heavy burden of debt.As your bankruptcy attorney in Tyler, TX will tell you, one of the most important benefits of filing bankruptcy is that you get the advantage of the automatic stay.A bankruptcy not only lets you start fresh financially, but you get the enormous relief of stopping the harassing collection calls.

An automatic stay goes into effect as soon as you file for bankruptcy.You don't have to attend any special hearings or ask for the stay.It comes with the bankruptcy.The attorney will notify all of the creditors you listed in your bankruptcy plan that the bankruptcy has been legally filed,and that is their cue to cease collection activities.

Stop, Stop, Stop...

Upon receiving notice that you have filed bankruptcy, creditors must:

>> Stop making collection calls asking for payment

>> Stop filing lawsuits

>> Stop pursuing lawsuits already filed

>> Stop repossessions of assets

>> Stop foreclosure proceedings

>> Stop wage garnishments

The automatic stay is merely a temporary order though that intends to give you and the court time to assess your financial situation.Any actions the creditors want to take to collect from you or to repossess assets must be approved by the court.

For example,if you file for bankruptcy and have a car loan,you may stop trying to make payments. In that case,the creditor may decide to ask the court to terminate the stay and allow the car to be repossessed.The bankruptcy attorney in Tyler,TX will probably try to renegotiate the loan at that point,especially if you need the car to get back and forth to work.

There Are Always Exceptions

The automatic stay does not stop criminal prosecutions or end child support or alimony payments.It also does not cover or suspend tax or student loan payments you are making.

One other point to be aware of is that only you are covered by the bankruptcy.If you have a co-signer on loans or debt and the co-signer doesn't file bankruptcy then the co-signer is not protected.The creditor can continue collection activities against the co-signer.

Creditors who violate the automatic stay can experience serious sanctions imposed by the court.It may take a few days for all of your creditors to be notified and for them to get the information into their computer systems, so you may still get a few calls early after filing bankruptcy.All you need to do is inform the creditor you have filed bankruptcy and give them the name of your attorney or a court case number.You should not try to negotiate on your own.

Filing bankruptcy is a major decision and one you should not make alone.If you are burdened with excessive debt and need relief,the first thing you should do is consult with a bankruptcy attorney in Tyler, TX. The attorney can review your financial condition and advise you on the best course of action.

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