Does bankruptcy stop bill collector calls?

Bill collectors and collection agencies in general tend to be aggressive and persistent. There are not very many good ways to stop them in New Jersey, but filing for bankruptcy could help. In fact, there are certain benefits associated with bankruptcy that could stop a variety of collection or repossession actions against you.

Please remember that this is only one aspect of whether bankruptcy is right for your situation. Also, this article does not differentiate between Chapter 13 and Chapter 7 bankruptcy, another important decision you would want to be informed about.

As mentioned on FindLaw, creditors have rules they should follow when contacting you. Beyond that, filing for bankruptcy stops most creditor attempts to get money from you. Something called an automatic stay goes into effect when you begin the procedure. This is essentially a declaration by the court that your debt is now under official jurisdiction until a prescribed date or condition.

Your creditors would receive notification about your bankruptcy along with a notice to stop pursuing payments. In place of their informal methods, they would now have a potential voice in your bankruptcy hearing. Since the legal process is highly regulated, you have a greater chance to stand on equal footing then you probably would if you were the target of collection calls.

The automatic stay also has the potential to stop and other undesirable actions on behalf of people to whom you owe money. For example, declaring bankruptcy may halt the foreclosure process until the court makes a decision.

When you finish your time in bankruptcy court, that does not necessarily mean that your protection is over. Rather, you would probably continue to benefit from certain protections the bankruptcy court provides as long as you complied with the final decision, whether it was a payment plan or liquidation.

The result of bankruptcy is different for everybody. However, the purpose — to provide relief for those struggling with unmanageable debt — is the same. Make sure to get detailed advice for yours or any other material situation. This is only intended as general information.

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