Can I Be Sued for Debt After I File for Bankruptcy?

Many consumers who file for bankruptcy in the Oak Park area are dealing with contact from creditors and debt collectors, and many are concerned that they may soon face a lawsuit from a creditor or debt collector to whom they owe money. At the same time, many debtors have already received notice of a civil lawsuit against them, and they often have questions about how a bankruptcy filing will impact such a lawsuit. Indeed, many individuals who file for Chapter 7 or Chapter 13 bankruptcy want to know: can I be sued for debt after I file for bankruptcy? In short, the answer is no, and our Oak Park bankruptcy attorneys can explain your rights to you in more detail.

How the Automatic Stay Prevents You From Being Sued

One of the most important tools in a bankruptcy case is the automatic stay. Under the Bankruptcy Code, the automatic stay applies to an individual bankruptcy case as soon as the bankruptcy petition is filed. This is true whether you are applying for Chapter 7 bankruptcy or Chapter 13 bankruptcy. What is the automatic stay, and how does it prevent you from being sued? The automatic stay is an injunction, and as soon as you have filed your bankruptcy petition, it prevents creditors and debt collectors from taking any action against you. There are exceptions, but only when a creditor or debt collector has petitioned the bankruptcy court to lift the automatic stay in a particular case (and this does not happen commonly). If a creditor or debt collector does take collection action against you, they will be in violation of the automatic stay.

Creditors and Debt Collectors Cannot Sue You After You File for Bankruptcy

The automatic stay prevents you from being sued. So, if you are anticipating that a creditor or debt collector might file a civil claim against you after they have threatened to do so over the phone or email, for example, the automatic stay will prevent this from happening. If a creditor or debt collector filed a civil lawsuit against you after your bankruptcy petition was filed, they would have violated the law.

Existing Lawsuits Against You Cannot Move Forward

Similarly, a creditor or debt collector cannot move forward in a lawsuit against you that is already pending. To be sure, the automatic stay also prevents any ongoing debt collection action against you from proceeding.

Contact an Oak Park Bankruptcy Lawyer

Bankruptcy law is extremely complicated, and it is important to have an experienced Oak Park bankruptcy attorney on your side, regardless of the relative complexity of your bankruptcy case. A lawyer at our firm can evaluate your financial circumstances today, and we can provide you with more information concerning your eligibility for bankruptcy. Whether you are eligible and planning to file for Chapter 7 or Chapter 13 bankruptcy, our firm is here to assist you. Contact the Emerson Law Firm today to find out more about the services we provide to our clients in Oak Park and the greater Chicago area.



See Related Blog Posts:

Getting Relief: Answers to Your Top Five Bankruptcy Concerns

Can Chapter 13 Bankruptcy Save My Home?

Comments

Post a Comment

Popular posts from this blog

Payday Lending and Predatory Lenders in Illinois

If you are in substantial debt in the Chicago area and are living in a paycheck-to-paycheck cycle, you may have taken out a payday loan to make ends meet. While payday lending is illegal in a number of states due to the predatory nature of these loans, it remains legal in Illinois. As a result, many debtors in the state have used payday lenders, and far too many of those borrowers cannot repay what they owe. According to a recent article from Progress Illinois , consumers have filed complaints about payday lenders in the state, illuminating a need for federal rules that address harmful lending practices . Predatory Payday Lenders and Protections for Consumers Due to the perceived predatory nature of payday loans, twelve states in the country have banned these lenders from operating completely, according to a fact sheet from loans.org . The states that currently have laws prohibiting payday lenders from operating include Arkansas, Arizona, Connecticut, Georgia, Mary...
Read more

Phantom Debt Collection Scams on the Rise in Illinois

Have you been contacted by a person claiming to be a debt collector who is seeking to recover a debt you allegedly owe? If so, you are not alone. According to a recent report from CBS Chicago , such parties claiming to be debt collectors are on the rise, and they are scamming Chicago-area residents. These alleged debt collectors are part of schemes known as “phantom debt collection scams,” since they involve the attempt to collect on a debt that the consumer does not actually owe. How can you avoid becoming a victim in a debt-collection scam ? What should you do if you have been targeted by a fake debt collector? How Do Phantom Debt Collection Scams Work? Now, you might be thinking to yourself: I would never agree to make payment on a debt that I did not owe. But the scam is not always that simple. Parties at the center of debt-collection scams often target consumers who do actually owe debts (to someone or to some entity), and they prey on the fact that these c...
Read more

New Information on Debts That Bankruptcy Cannot Discharge

If you are thinking about filing for bankruptcy in the Oak Park area, it is important to know that certain kinds of debts cannot be discharged in a bankruptcy case. Under U.S. bankruptcy law, these are known as non-dischargeable debts, or exceptions to discharge. There are certain types of debts that have long been identified clearly as non-dischargeable debts, while there are misconceptions about other types of debts that may or may not be dischargeable. As an article in CNBC discusses, the U.S. Supreme Court recently issued a ruling in the case of Bartenwerfer v. Buckley , which clarifies that debts incurred due to another party’s fraud cannot be discharged in an individual’s bankruptcy case. Our Oak Park bankruptcy attorneys can explain the Court’s recent ruling and provide you with additional information on dischargeable and non-dischargeable debts. Supreme Court Says Debt Incurred Due to Another’s Fraud is Non-Dischargeable The recent Bartenwerfer case involved a debtor attempti...
Read more