Do you have an existing lawsuit? Whether you are being sued for a debt or fraud, you may be wondering if you are protected in your bankruptcy.
What is an Automatic Stay?
When you file for bankruptcy an automatic stay helps protect you from creditors. This is a court-ordered injunction. It prevents creditors from seeking legal action against you after filing for bankruptcy. Without the filing, creditors can contact you by mail, phone, text, and so on. This may cause you to feel overwhelmed if you are having difficulty repaying your debts.
What happens After Your Bankruptcy is Filed?
After filing, the creditors listed in your bankruptcy paperwork are contacted to explain that you have filed for bankruptcy. As a result, the creditors must stop all communication with you. Now, any inquiries will be sent to your attorney instead. This is helpful if you have a pending foreclosure, wage garnishment, repossession, or eviction. However, there are certain circumstances where an automatic stay can be delayed or lifted by the court. But, the court will not lift an automatic stay without reviewing the case thoroughly.
When the Automatic Stay Does Not Apply
In a recent ruling in Texas, a judge ruled that a medicaid fraud lawsuit was not subject to the automatic stay. What does this mean for you? Well, this sets precedent that a state court fraud suit can be ruled as not applying to your bankruptcy’s automatic stay. We recommend that you speak with your attorney in detail about any lawsuits or judgments in detail before filing.
How Long Does an Automatic Stay Last?
The automatic stay continues throughout your bankruptcy. It will end when your case is discharged, dismissed, or your repayment plan is completed. Once the automatic stay ends, creditors can contact you for any debts that were not discharged in the bankruptcy.
Need More Information?
At the Law Office of Daniela Romero, we believe in relationships that are based on trust. Before we work together, we would like to get to know you and we would like you to get to know us. We want you to be sure that we are the perfect fit for you. This will allow you to be completely comfortable sharing intimate and difficult details of your case, so we can offer you representation to the fullest extent of the law. Call us today to set up a free consultation.