Will Bankruptcy Stop the Creditor Calls?

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Yes, the minute you file bankruptcy, the Bankruptcy Court issues an order telling all of your creditors to leave you alone. No more phone calls. No more collection letters. No more lawsuits. No garnishments. No repossessions. No foreclosures. Nothing.

No actions whatsoever against you or your assets. This order has a name. It is called the “Automatic Stay,” and it is issued pursuant to Title 11 of the United States Code, Section 362.

The Automatic Stay prohibits your creditors from taking any action that could be considered an attempt to collect a debt from you or your assets. Once you file bankruptcy, the creditor is not even allowed to call you or send you letters. In addition, the creditor must stop any collection attempts already started.

The Automatic Stay is very powerful and puts the full weight of the United States Courts to work for you, to make sure your creditors leave you and your assets alone.

And if you file for Chapter 13, section 1301 of the Code also applies the automatic stay to a co-debtor on any consumer debt.

If a creditor violates the Automatic Stay, you have the right to bring the creditor before the Court for Contempt of Court, and to be compensated accordingly. This is not a hollow right. Bankruptcy Court Judges do not take kindly to creditors who ignore their Order-the Automatic Stay-and these Judges have been known to punish creditors severely.

Very simply, once you file for bankruptcy, creditors must leave you alone or suffer the consequences.

Michael A. Cibik, Esquire

Michael A. Cibik is a partner at the Philadelphia law firm of Cibik & Cataldo, P.C. He is one of the few bankruptcy attorneys in the Philadelphia area certified by the American Bankruptcy Board.

If you or someone you know is having financial problems, stop worrying and call Michael at (215) 735-1060 for a free consultation.

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Can A Bankruptcy Continue After Death of a Debtor?

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One of Benjamin Franklin’s most famous quotes is, “Certainty? In this world nothing is certain but death and taxes.”

With the certainty that is death, it is not surprising that occasionally, after a bankruptcy is filed, a Debtor will die.

However, the death of a Debtor does not automatically mean the death of his or her case.

The Bankruptcy Code permits the continuation of both Chapter 7 and Chapter 13 cases after a death.

Federal Rule of Bankruptcy Procedure 1016 deals with the issue of the death or incompetency of a Debtor.

Rule 1016 permits the continued administration of a Chapter 7 case “…in the same manner, so far as possible, as though the death or incompetency had not occurred.”

Likewise, in a Chapter 13 reorganization, the case can continue to be administered if it is in the best interest of the parties.

The ability to get a discharge of debts in a Chapter 7 can be a tremendous benefit to the deceased heirs of an estate, since they would be able to assume the assets of the deceased person without having to assume the debts.

In Chapter 13, the ability to continue with the case can be more difficult because of the fact that the payment of debts through the Plan will almost always have been based on the Debtor’s own income which will no longer be available.

However, sometimes a family member or members may wish to come forward to fund the Plan. This is particularly true where the bankruptcy may have been filed to address an arrearage on real estate or to stop a foreclosure/sheriff sale.

By continuing with the 13, the family member(s) may be able to pay out the arrearage to keep the house, or obtain refinancing to pay off the home loan.

Decisions on whether to continue on with a bankruptcy after death can be as much an issue of State inheritance laws as it will be an issue of bankruptcy itself.

Michael A. Cibik, Esquire

Michael A. Cibik is a partner at the Philadelphia law firm of Cibik & Cataldo, P.C. He is one of the few bankruptcy attorneys in the Philadelphia area certified by the American Bankruptcy Board.

If you or someone you know is having financial problems, stop worrying and call Michael at (215) 735-1060 for a free consultation.

The post Can A Bankruptcy Continue After Death of a Debtor? appeared first on Philadelphia Bankruptcy Lawyers.

from Philadelphia Bankruptcy Lawyers http://bit.ly/2WEXDE4