Most Escondido residents have heard the expression "when it rains, it pours," and for those individuals and families that are experiencing financial challenges, this expression can ring especially true. Many people have trouble just making the minimum payments on liabilities such as credit card debt, car loans or mortgages. And then, on top of the stress this can cause, debtors in this position have another problem to worry about: creditor collection efforts.
This is why when you file for bankruptcy the automatic stay that is part of the process becomes so important. Yes, the overall goal of a personal bankruptcy action is usually to discharge debt and re-emerge in a better financial position, but as soon as the petition for bankruptcy is filed an automatic stay of creditor collection efforts goes into place. For Escondido residents who have been hounded by phone calls and letters from creditors, this automatic stay can be just as much of a reason to file for bankruptcy as anything else.
How else can an automatic stay help you when filing for bankruptcy? Well, beyond stopping creditor harassment, the automatic stay will also put a stop to foreclosure and eviction actions, and it can also put a temporary stop to any efforts to shut off utilities, if you are behind on those bills as well.
The automatic stay is just one aspect of Chapter 7 bankruptcy that may be helpful for Escondido residents who are facing financial challenges. If you are beginning to feel the pressure from mounting bills and creditor harassment, then you may want to get more information about how bankruptcy can help.
Source: FindLaw, "The Automatic Stay: Stopping Creditors with Bankruptcy," accessed Jan. 24, 2016