People are often confused about just what the automatic stay in bankruptcy is. As an Orland Hills bankruptcy attorney, I know that the automatic stay in bankruptcy is a provision in the bankruptcy code that allows a debtor to stop any collection efforts from all creditors. So the bankruptcy protection that a debtor is seeking is found in the automatic stay provision of the bankruptcy code. This is going to stop any collection effort from all creditors. For instance, if a person comes in and has a garnishment that has been executed and the person is being garnished every time they get a paycheck, then it is going to stop that garnishment. If there is a frozen bank account or a frozen account for a joint account holder, this will also be stopped when the automatic stay is put in place.
Not only will it stop those types of things but it will stop all communications whatsoever so any communication from a creditor by way of letters, phone calls, e-mails, texts, or lawsuits are all stopped by the automatic stay provision. This is true under all of the types of bankruptcy. So the relief from bankruptcy is going to stop harassing creditors and harassing phone calls for a person who files bankruptcy; not only is it going to stop those communications but if a debtor continues to receive phone calls or communication from a creditor after the bankruptcy has been filed and after notice has been given to the creditor, then each time a communication is sent to the debtor, that is a violation of the automatic stay. The violation of the automatic stay is going to allow a debtor to sanction those creditors for monetary values.
So if a creditor continues to call a debtor after the automatic stay has been noticed and given to that creditor, then a debtor could sue that creditor and ask for monetary sanctions to be given to the debtor for those specific violations of the automatic stay provision. This is a remedy available to debtors and a pillar in the bankruptcy process.
So the automatic stay is a powerful, powerful tool. It allows the debtor the relief needed from harassing phone calls, lawsuits, garnishments, and frozen bank accounts, communications by way of letters, e-mails and texts. All of this will be stopped in the automatic stay provision of the bankruptcy code. For more help in this area, contact an attorney who has an office in your home town or municipality.