In this difficult economy, many individuals find themselves in a perilous financial situation. Filing bankruptcy can provide financial relief for those whose debt has become overwhelming. This is especially true in cases where a lawsuit has been filed against a debtor for collection proceedings.
When a creditor files a lawsuit, they petition the court for permission to collect a specific amount of money to cover a debt. This means they can levy bank accounts and garnish wages to cover the debt. They can also seize assets as the court sees fit.
Filing for bankruptcy will stop collection procedures, including any lawsuits, from continuing forward. Filing for bankruptcy is like putting a restraining order on your creditors, making it illegal for them to contact you or in any other way try to collect the debt. This stay of action lasts throughout the duration of bankruptcy proceedings until the debts are discharged. Then, any debts discharged through bankruptcy are no longer eligible for collection.
There are very few debts that are not discharged through bankruptcy. Child support, student loans, some taxes, and a few other types of debt are generally not dischargeable. A bankruptcy attorney can advise you as to what type of bankruptcy might best fit your situation.
Any debts discharged at the end of your case will continue to be ineligible for collection thereafter. The experts at Rulon T. Burton & Associates can help you stop lawsuits filed by creditors and help you get back on track financially.