Immediately upon the filing of a bankruptcy petition, the Automatic Stay provision of the bankruptcy code is effective immediately. This means that no creditor may commence or pursue any action against the debtor (person filing) for any action, regarding a monetary debt.
All lawsuits must stop immediately, no matter where the case is pending in the litigation process. If a bankruptcy petition is filed before the creditor commences a wage garnishment, the creditor may not start garnishing the wages. If the petition is filed after the wage garnishment has commenced, the garnishment must cease, immediately. Any funds deducted from the wages after the bankruptcy filing must be refunded to the debtor.
The following creditors’ actions must cease, immediately, upon the bankruptcy filing:
termination of utility service;
application of a lien;
application of a bank levy;
mortgage foreclosure action;
tax foreclosure action;
repossession of auto or other property;
telephone calls and any communication of any kind;
eviction action, unless a warrant of removal is entered.
Upon the filing of a bankruptcy petition, the creditor may not communicate or correspond with the debtor by any means, including, but not limited to, the following: letters, telephone calls to debtor, or any other parties. In certain situations, the creditor must return a repossessed auto and restore utility service.
Robert Manchel, bankruptcy lawyer in NJ, may be contacted at 1(866) 503-5655 to discuss your options for seeking bankruptcy protection.