We talked in an earlier blog about debt collection and what to do if you are being harassed by creditors. If your financial situation cannot be remedied by measures like a consolidation loan, debt counseling or working with creditors to renegotiate debt, bankruptcy may be an option to consider. An important feature of any bankruptcy action is the automatic stay.
The automatic stay is a legal right to breathing room after you file for bankruptcy. Effective immediately upon the filing of a bankruptcy petition, the automatic stay accomplishes the following:
While the automatic stay offers powerful protection, that protection is temporary. The stay stops legal proceedings for a period and allows you to sort out what can be paid — or sold — depending on the type of bankruptcy petition you file.
If your debt is secured by property, creditors can file a motion to lift the automatic stay to repossess their property or pursue a foreclosure. Unless payments are made to bring the loan current, or unless another loan workout plan is agreed upon with the creditors, a bankruptcy court can lift the stay and allow creditors to proceed with collection efforts.
Bankruptcy provides important protections on the way to a future less burdened by debt. If you are facing an unmanageable financial picture in Florida, seek advice from an experienced Jacksonville, Florida bankruptcy attorney.
Attorney Shane Herbert also contributed to this blog post.