For anyone struggling to make ends meet while faced with overwhelming debt, harassment from creditors and debt collectors often adds insult to injury. Fortunately for those who seek a fresh start by filing for bankruptcy, a legal device known as an "automatic stay" offers relief from debt collectors' often incessant phone calls and letters.
An automatic stay bars most creditors from taking action to collect a debt, for instance by calling or garnishing wages, and also stops any foreclosure, repossession or collection lawsuit that may be pending against an individual. The automatic stay goes into effect as soon as a person files for bankruptcy, giving debtors time to clear their heads and begin putting their finances back in order. While most consumer debts are covered by an automatic stay, certain debts remain unaffected, including debts for back child support or spousal maintenance.
FDCPA Protects Consumers From Creditor Harassment
In addition to the automatic stay that accompanies a bankruptcy filing, a federal law called the Fair Debt Collection Practices Act, or FDCPA, offers additional protection from some of the worst forms of debt collector harassment. The FDCPA applies to all personal debts, regardless of whether or not the borrower has filed for bankruptcy. For instance, under the FDCPA, a debt collector may not:
- Use threats or foul language
- Misrepresent the amount that you owe
- Harass you with repeated phone calls or call you at inconvenient times, such as before 8 a.m. or after 9 p.m.
- Threaten to have you arrested if you do not pay your debt
- Send you papers made to look like official court documents
For people who are overwhelmed by unmanageable debt and unable to keep up on their payments, bankruptcy may provide an opportunity for a fresh financial start. However, bankruptcy is not right for everyone. For more information about the pros and cons of bankruptcy and how they may apply to your specific circumstances, contact an experienced bankruptcy lawyer in your area.