What If I Stop Receiving Mortgage or Car Statements After Filing for Bankruptcy?
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Once you file a bankruptcy, an automatic stay goes into effect. This automatic stay states that no creditor can try to collect any debt from you; according to statute 11 U.S.C § 362 (6), “any act to collect, assess, or recover a claim against the debtor that arose before the commencement of the case under this title”. If a creditor does contact you with payment demands, a Charlotte bankruptcy lawyer or Greensboro bankruptcy lawyer can file what’s known as a “motion for sanctions” which reprimands the creditors attempting to collect the debt.
Even though you are current, and are going to keep your house or car; many creditors will still not send you a bill once you have filed the bankruptcy. Ever heard the phrase, “better safe than sorry”? Well, this is exactly why you are not receiving your statements now; they do not in any way want to violate the automatic stay. If you had set up automatic bill pay, this will likely stop as well. You just have to remember regardless of whether you receive a bill, you must continue to make your house or car payment! If not, the creditors have the legal right to foreclose on your home or repossess your vehicle.
What can you do? Simply call them and request that they still continue to send you your statements. They may send something to your bankruptcy attorney asking for he/she to sign off to give permission for you to resume receiving statements for their records, but in most cases, it is as simple as that. Again, the main reason a creditor stops sending you statements is because they do not want those statements to be viewed as an effort to collect a debt which would violate the automatic stay that goes into effect when your bankruptcy is filed.
Will Bankruptcy Stop Creditor Phone Calls and Harassing Contact?
Yes, once a person has case number after filing either a Chapter 7 bankruptcy or a Chapter 13 bankruptcy, a creditor is prohibited from trying contact the debtor in any attempt to collect a debt.
Can I Keep My Credit Cards After Bankruptcy?
Now I know most people will look at this question like, “why in the world would I want to keep my cards if I’m eliminating my debt?!” But occasionally, you will have one company in which you are still in good standing and will want to keep that card in hopes of somewhat holding on to what bit of credit that you have left. It’s just not as simple as that.
Have you ever been in a wreck? The next few days following the wreck, you will be bombarded with advertisements from attorneys claiming that they can help you in whatever service you may need from being in the accident. Many wonder how they even knew about the wreck in the first place! Well filing bankruptcy is a similar situation, once you file it is public knowledge and your creditors, whether they were included in the bankruptcy or not, will likely find out about the bankruptcy and will cut the usage of your account off. Most creditors’ fear violating the bankruptcy’s automatic stay so they will discontinue usage of the credit card. So in the situation of a credit card in which you wish to keep, you may have never missed a payment and have been in good standing and they will still cut the usage of the card off, which is why we recommend that you list ALL of your debts.
Should you wish to try to keep a credit card out of the bankruptcy and wish to continue making the payment, then you need to contact that credit card company and give them a heads up on what your intentions are and ask for permission to have that card be kept out of the bankruptcy filing. It will be completely and solely the discretion of the company whether or not they allow you to keep the card out of the bankruptcy and continue to make the payments, and report the standing to the credit reporting agencies.
If you don’t list down a credit card, with the hopes of keeping it, and then after filing the bankruptcy they shut it down anyways, you are still responsible for the debt. For example, if you have a Visa credit card with Wal-Mart and you talk with Visa and explain you are filing bankruptcy and they say they will allow you to keep the card but, after filing, they still shut it down, you are responsible for any remaining balance on the card. You may still be able to go back and amend the bankruptcy after the credit card company refuses to allow you to keep the card but there will be court costs involved in amending the bankruptcy.
Again, we always encourage our clients to list down all of their debts. You can rebuild your credit after bankruptcy and in order to get your fresh financial start it usually means wiping out all of your debts.
Will Bankruptcy Stop An Eviction from an Apartment or Rental House?
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Generally speaking, bankruptcy will not stop an eviction. In 2005, the bankruptcy laws were changed under the Bankruptcy Abuse Prevention Consumer Protection Act. This act prevents bankruptcy from stopping evictions on rental properties, which are properties that are being leased. In other words, if you are facing an eviction from an apartment or rental property bankruptcy cannot stop that eviction process. However, bankruptcy may still be an option for you to consider. Depending upon your landlord, they may come after you for the past due rent. They could sue you and get a judgment against you on the amount past due. Filing for bankruptcy will wipe out the amount owed to your landlord and stop them from getting the judgment or wipe out the judgment if they had already obtained it.
What if you have a house that is facing a foreclosure though? If you have been given a notice of sale or foreclosure on your home, then bankruptcy may be an option to consider. Here is more information on how bankruptcy can stop the foreclosure of a home. Be sure to contact an attorney as soon as possible to explore your different options.
What is a Motion for Relief from Automatic Stay?
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A motion for relief from automatic stay is filed by one of your creditors after the bankruptcy has been filed. It is the legal process of the creditor requesting the court’s permission to proceed with legal action against you. This is filed by secured creditors such as a mortgage company or auto finance company, if you are not making payments to the Chapter 13 bankruptcy Trustee in a Chapter 13 bankruptcy.
