Texas Bankruptcy Blog : Texas Bankruptcy Lawyer & Attorney : Fears Nachawati law Firm : Chapter 7, Chapter 13, Consumer Bankrutpcy : Dallas, Fort Worth, Austin, Houston, San Antonio

When you are experiencing a financial crisis you may feel like you are the only one in that situation. The reality is that many people are feeling the current financial crunch for one reason or another. So whether you live in Dallas or any other part of the country, you are not alone!

The following top five reasons seem to be the most common reasons why many people are filing for bankruptcy:

1. Wiping the slate clean. The goal of a discharge is to reduce debt to give you a fresh start.

2. Stop foreclosure or sale of your home.  If your home is in foreclosure a Chapter 13 bankruptcy will stop the foreclosure any time prior to the sale.

3. Prevent repossession of your car or other property. If the bankruptcy is filed quickly enough it can effectively force the creditor to return your car or other personal property.

4. Stop aggressive collection efforts by creditors. Often, creditors will call the home of a debtor at all hours and behave in an abusive manner. Bankruptcy will help stop the harassing phone calls and other aggressive behavior by creditors.

5. Restore or prevent your utilities from being shut off. Filing bankruptcy can prevent the utility company from pulling the plug on you.

If you are experiencing a financial crisis, contact bankruptcy law firm, Fears | Nachawati, toll free at 1.866.705.7584 or info@fnlawfirm.com for a free bankruptcy consultation.

The automatic stay is the bankruptcy law’s most powerful provision and immediately stops nearly all creditor actions against a debtor.  The automatic stay is invoked upon filing the case – no hearing is necessary and no judge’s signature is required.  This powerful injunction is even effective against creditors that have no actual knowledge of the bankruptcy!

Congress has stated that the policy behind the automatic stay is to give the “debtor a breathing spell from his creditors, stopping all collection efforts, all harassment, and all foreclosure actions. It permits the debtor to attempt a repayment or reorganization plan, or simply to be relieved of the financial pressures that drove him into bankruptcy.”  See Notes of Committee on the Judiciary, Senate Report No. 95-989.  That “breathing spell” is a welcome relief to families with overwhelming financial burdens.

The automatic stay prohibits a creditor with a claim that arose before commencement of the bankruptcy case from taking many actions, including:

• contacting the debtor to request payment (stops collection calls)
• initiating or continuing a lawsuit against the debtor (stops lawsuits)
• enforcing a judgment against the debtor (stops wage garnishments)
• repossessing personal property or foreclosing on real estate (stops repossessions and foreclosure)

The automatic stay is a temporary injunction which can be contested by a creditor and lifted by the bankruptcy court after notice and a hearing.  There are a few exceptions to the automatic stay, for instance: the automatic stay does not prevent criminal prosecutions.  Likewise the automatic stay does not stop lawsuits to establish or modify alimony, maintenance, or support.

Individuals that file for bankruptcy receive this powerful legal injunction against creditor actions.  However, the automatic stay is just one weapon in your bankruptcy attorney’s arsenal.  Your bankruptcy attorney can use the power of the bankruptcy laws to help you make the best decisions for your family’s future financial health and recovery.

Contact bankruptcy law firm Fears | Nachawati today for a free consultation to learn more about automatic stay and your rights.  Call us toll free at 1.866.705.7584 or e-mail us at info@fnlawfirm.com.