Personal bankruptcy can provide a variety of protections to struggling consumers in need of them. In addition to debt relief, personal bankruptcy can provide some forms of more immediate relief as well that consumers seeking the help of personal bankruptcy protection can benefit from.
What can the automatic stay do for struggling consumers? In general, the automatic stay goes into effect once the filing party files for personal bankruptcy protection and stops creditor collection actions while the bankruptcy process progresses.
Once they file for personal bankruptcy protection, the impact of the automatic stay:
- Can help utility services from being disconnected;
- Can stop eviction and foreclosure proceedings;
- Can stop wage garnishment;
- Can stop a government agency from taking back overpayment of public benefits paid to the filing party
The extent of relief the temporary stay can provide may vary in certain circumstances or end when the bankruptcy is complete. As a result, it is important for filing parties to understand how the automatic stay can help them and also how personal bankruptcy protection can help.
Both Chapter 7 personal bankruptcy protection and Chapter 13 personal bankruptcy protection can help filing parties enjoy debt relief. Once the petition for personal bankruptcy protection has been filed, the automatic stay goes into effect and requires creditors to quit calling the filing party or contacting them by mail. This can provide breathing room for the struggling consumer and a much-needed break from the stresses and strains of overwhelming debt which personal bankruptcy protection can also provide in the form of debt relief.