Many people in California struggle to stay on top of their bills, and if you count yourself among them, you may be seeking a way to dig yourself out of debt. You may, too, find yourself facing calls and communications from creditors attempting to collect the money you owe them.
According to LendingTree, filing for bankruptcy is one way to stop many of these calls and communications. Once you open a formal bankruptcy case, something called the “automatic stay” takes effect. During this time, many, but not all, of your creditors have to stop making attempts to collect what you owe them. Here are some of the creditors who have to stop contacting you once while the automatic stay is in place.
Utility companies
You may feel justifiably stressed if your water or electric companies are threatening to disconnect your services. However, once you file for bankruptcy and the automatic stay takes effect, utility companies that offer “essential services” may not do so for at least 20 days.
Creditors garnishing wages
If you have a creditor collecting on a debt through wage garnishment, this also ceases while the automatic stay remains in place. So, during this time, you should be able to receive your full salary without losing a portion of your income to garnishment.
Credit card companies
The automatic stay also stops credit card companies from contacting or harassing you while your bankruptcy case is pending. If a credit card company does contact you after initiating bankruptcy proceedings, tell them you filed for bankruptcy and make a point to document the conversation in writing.
While bankruptcy’s automatic stay protects you from many forms of creditor harassment, it does not absolve you from having to pay all financial obligations, such as child support orders.