If you are one of the many Americans who struggle with credit card debt, overwhelming medical expenses and a pricy mortgage, you may have considered filing for bankruptcy. Although there are several options for those who need debt relief, Chapter 7 bankruptcy wipes out many sources of debt and allows you to start fresh with a clean financial slate. In addition to discharging many of your excessive debt and expenses, it can stop those annoying creditors from contacting you all hours of the day and night.

Once you file for Chapter 7, and several other types of bankruptcy, an automatic stay is put in place on your account. The automatic stay prohibits creditors and collection agencies from contacting you regarding missed and late payments. As you are filling out your bankruptcy paperwork, it is important to list all of your current creditors, as these will be the companies and entities that receive the automatic stay. After the stay is in place, creditors and collection agencies can no longer engage in the following:

  • File a lawsuit or continue to pursue a lawsuit
  • Call you at all hours of the day and night
  • Use profanities, expletives or threaten you
  • Garnish your paycheck wages

In some cases, collection agencies have been known to use abusive tactics in an attempt to scare people into making their payments. Agencies may threaten to take their children away or even place the debtor in jail unless they make payments on their account.

This information is intended to educate and should not be taken as legal advice.