Dealing With Creditor Harassment After Bankruptcy

the shocked and disappointed man saw the bad news in the invoicesMany individuals face creditor harassment after filing for bankruptcy. Although it can be unpleasant, it does not have to be insurmountable. Filing bankruptcy provides you with what is known as an “automatic stay.” An automatic stay ensures creditors cannot collect any debts discharged in your bankruptcy proceedings.

When a creditor tries to collect after discharge, contact the AL Mobile attorneys at the Loris Bankruptcy Law Firm to protect your rights.

Creditor Protections During Your Bankruptcy

Filing bankruptcy offers several legal protections based on the Bankruptcy Code and Alabama state-specific legislation. These safeguards will assist you with creditor harassment after your bankruptcy case.

Can a Creditor Try To Collect After Discharge

First, filing for a petition automatically puts an end to most collection activities against you and your property. The filing of this petition means creditors cannot continue suing, garnishing wages, or repossessing assets without a court order.

The automatic stay also prevents creditors from foreclosing on your home or collecting money on any security agreements you have with them, such as deeds of trust, mortgages, and judgment liens on your property.

Another critical creditor safeguard is the priority payment scheme. Secured creditors generally receive the value of the collateral used as security for debt repayment – even if that value decreases due to depreciation.

Debtors in Chapter 13 can keep their property if they make enough protection payments to secured creditors before the bankruptcy court approves their plan. For example, a Chapter 13 approval may include making home and car payments directly to a secured lender or lessor before the court approves.

Creditor Protections After Your Bankruptcy

Once you file for bankruptcy, the automatic stay will take effect, which prevents creditors from taking further collection action against you. This automatic stay includes stoppages of foreclosure proceedings, eviction notices, car repossessions, or wage garnishment.

Throughout the bankruptcy process, you can object to any creditor’s actions. An objection means you can challenge debt collectors’ attempts at collection or even demand that they refund the money you paid before filing for bankruptcy protection.

Another advantage of bankruptcy is keeping your home and other assets. For example, you may be able to reaffirm a mortgage or auto loan and continue making payments, but only if you can afford the new monthly payments after filing for bankruptcy and have enough equity in the property to cover any outstanding amounts on loan.

Consult an Alabama Bankruptcy Lawyer To Stop Creditor Harassment

An Alabama bankruptcy lawyer will help things go smoothly and handle any more intricate tasks so you can focus on what matters most. If a creditor has been harassing or trying to collect on discharged debts, they could violate your bankruptcy rights. Therefore, when filing for bankruptcy, the court orders an injunction prohibiting creditors and collection agencies from contacting you to collect on your account.

Constant harassment from creditors can drain your emotional well-being and capacity for managing debts. Harassment may be aggressive calls and letters, threatening letters, or even legal action threats.

Thankfully, federal law offers protection to consumers against creditor harassment. The Fair Debt Collection Practices Act (FDCPA) sets forth stringent regulations creditors must follow when collecting from borrowers.

Our AL Mobile attorneys can protect you against creditor harassment that violates the FDCPA. Furthermore, your Alabama bankruptcy lawyer will represent you in court against the creditor for their illegal harassment and help recover monetary damages. Call Loris Bankruptcy Law Firm at (251) 432-3100 to speak with an Alabama bankruptcy lawyer if you have a creditor trying to collect after discharge.