One of the most common things you will experience if you owe a significant amount of debt is constant contact from creditors. They will call, email and send you letters regularly, if not all the time. If debt collectors cannot get payment on an overdue debt, they may also initiate other means of collecting money from you. This could include wage garnishment, foreclosure, repossession and more. These are all stressful, and they could make your financial situation worse.
The threat of losing more money or your property while struggling with debt can be overwhelming. You may feel as if there is no way out, but in reality, bankruptcy does offer you a way to deal with certain types of debt that you can no longer manage on your own. Another benefit of filing for bankruptcy is the automatic stay, which halts all collection efforts and cuts off any contact from debt collectors.
The automatic stay provides relief
The intent of the automatic stay is to provide relief from creditors and debt collectors for those who are in bankruptcy protection. This goes into effect as soon as you file for bankruptcy, which means that it is no longer permissible for these agents to seek payment or pursue other action against you. This allows you to follow the terms of your bankruptcy plan without additional stress and complication, but there are times when creditors may ask the court to lift the automatic stay.
If the automatic stay is already in effect and a creditor attempts to contact you, it is a violation of bankruptcy laws. You may have grounds to pursue legal action against the offending party. Another objective for the automatic stay is that it puts all creditors on equal footing, preventing one from seizing the assets of the Tennessee applicant before other creditors can collect some repayment.
Other benefits of the bankruptcy process
When facing a significant amount of debt, you may feel as if there is no way out. In reality, there are legal options available to you that will allow you to seek a better financial future. Through bankruptcy, you may be able to confront certain balances you are facing, seek relief from those burdens and emerge from the process with more stability and security. You may benefit from seeking an assessment of your case and explanation of whether bankruptcy is truly the best choice for you.