If you’ve been struggling to pay your credit card bills each month, you may be wondering if there’s any way out of your financial mess. Only someone who has gone through this can understand how stressful the situation can be, and may seem like there is no way out.
Well, one legitimate option that you should consider if you simply can’t pay all your bills is bankruptcy. The automatic stay provision in bankruptcy prevents creditors from trying to collect a debt after you have filed for bankruptcy.
Automatic stay gives you some temporary relief by preventing creditors from beginning foreclosure proceedings or trying to repossess your assets. The bankruptcy court actually prevents any of this from taking place.
Believe it or not, the creditors are not even allowed to contact you once you have filed for bankruptcy. If they do, they’ll have to answer to the judge and will probably have to pay fines as a result. Now, you still have to go through the bankruptcy process, of course.
You should understand that the automatic stay is a temporary procedure that gives you some breathing room when dealing with bill collectors. However, you have to go through the entire process to see what the outcome of your bankruptcy case will be. At the very least, the automatic stay gives you some temporary relief while you and your bankruptcy lawyer make your case.
If you’re worried about the bankruptcy law and whether you’ll be eligible to file, you shouldn’t be. Most people will still be eligible even though there are some additional requirements that you’ll have to go through.
Some of the new requirements include mandatory financial management courses in credit counseling. Also, depending on your annual income, you may have to go through additional hurdles to prove that you really do need bankruptcy. However, it remains a viable option for most people who would have previously qualified.
Bankruptcy remains a viable option for many people, and you should speak to a lawyer if you’re considering this option. Firstly, however, you should continue reading more articles like this one to get as much information as possible before contacting your attorney.
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