What if I’m being sued when I file for bankruptcy? | Local Bankruptcy Attorneys

Bailing Out on Bankruptcy
Bailout vs bankruptcy Recent government bailouts of private businesses have generated debate about whether the time-honored institution of bankruptcy is the appropriate mechanism for dealing with big business insolvency. Naysayers of the TARP bailouts contend that rescued businesses are candidates for bankruptcy and that bolstering them with public funds not only fails to address underlying [...]

Put an End to Creditor Harassment
Being harassed by creditors and their collection agencies is one of the worst things about having financial problems.
They call constantly. They bother you at work. They call your boss. They knock on your door. They call your friends. Faced with insurmountable debt, you may feel there’s nothing you can do to stop them. But you have legal rights and remedies.
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Celebrity Bankruptcies
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Keep Your Home
The risk of losing a home prompts a lot of people to seek help from an attorney. Most people who file Chapter 7 or Chapter 13 bankruptcies are able to save their homes and cars from foreclosure or repossession, but there are many factors to consider.
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Bankruptcy Is the Answer for Many
The last resort You can’t make your mortgage payment. Or you’ve lost your job and are faced with a mountain of credit card debt. Either way, you’re a casualty in the nation’s economic avalanche and you find yourself contemplating the last resort — bankruptcy. Bankruptcy is a choice more and more Americans are willing to [...]

Overextended? You’re Not Alone
If you’re like many Americans right now, you’re struggling just to make day-to-day ends meet. You may be thinking you’ll never get current on your debts, let alone pay them off.
We want to help. From here, you can get answers to frequently asked questions about bankruptcy, review other debt-relief options, check out helpful online resources, or join a live chat group. In the end, it’s best to consult a bankruptcy attorney in your area to find out which debt-relief option is best for you. We’ll help you get a FREE 30-Minute Consultation.

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What if I’m being sued when I file for bankruptcy?

When any bankruptcy case is filed, a court order called an automatic stay immediately goes into effect. The automatic stay prohibits the initiation or continuation of lawsuits and other kinds of legal proceedings against the debtor or the property of the bankruptcy estate. When you obtain a discharge of debts, the automatic stay is replaced by a permanent court order prohibiting the same acts covered by the automatic stay.

The automatic stay applies to many kinds of lawsuits, including actions for collection of unsecured debts. There are, however, many instances where the automatic stay does not apply. Exceptions to the automatic stay include criminal proceedings, divorce and domestic support actions, tax audits, demands for tax returns and tax assessments (although tax collection may be subject to the stay), and some kinds of residential eviction actions.

If you are involved in a foreclosure or repossession action when you file for bankruptcy, the effect of the stay depends on which type of bankruptcy you filed. Under Chapter 7, the automatic stay will stop the foreclosure or repossession initially, but the debtor’s default on payments will give the court cause to lift the stay at the secured creditor’s request and allow the action to proceed. Under Chapter 13, on the other hand, the stay of a foreclosure or repossession will continue for the duration of the bankruptcy, so long as the debtor makes all the arrearage and current mortgage payments called for in the plan.