Stop Debt Collection Lawsuits in Hayward

Hayward Debt Collection Defense Attorney

If you owe money to a creditor, you may be worried that they will file a debt collection lawsuit that will cost you additional money and time. Debt collection lawsuits in Hayward can have serious consequences. For example, if a creditor wins a judgment in the lawsuit, they may be able to and garnish your wages or force you to sell your home. However, filing for bankruptcy can protect Hayward residents against these types of aggressive actions by creditors.

Bankruptcy’s Automatic Stay

Bankruptcy law exists to protect debtors by giving them space from creditors and helping them get rid of their debt. Many people are aware that debts can be wiped away in bankruptcy. However, some of the other protections that bankruptcy offers, such as the automatic stay, are less well known.

The automatic stay is a type of court order, called an injunction, which is issued by the bankruptcy court. The automatic stay is an important part of the two types of bankruptcy that are available to individuals in Hayward, Chapter 7 Bankruptcy and Chapter 13 Bankruptcy. The bankruptcy code ( 11 U.S.C. 362) specifies that the automatic stay takes effect immediately upon the filing of a petition for bankruptcy. The automatic stay forbids certain types of creditor activities, such as:

  • Filing a debt collection lawsuit;
  • Proceeding with a lawsuit that is already filed;
  • Stopping your utilities from being disconnected;
  • Stopping foreclosure proceedings;
  • Stopping an eviction; and
  • Stopping a wage garnishment.

These protections can help a debtor in Hayward by giving them additional time to sort out their finances. It may also be possible that the debt that would have been the basis of the debt collection lawsuit can be wiped away completely in Chapter 7 Bankruptcy.

If you file for bankruptcy and a creditor willfully violates the stay, you may be entitled to any actual damages you suffer, attorney’s fees, and potentially punitive damages.

Limitations of the Automatic Stay

Before filing for bankruptcy, it is important to be aware that the automatic stay does have some limitations. For example, the automatic stay does not protect against:

  • Tax assessments by the IRS;
  • A Lawsuit for child support payment;
  • A lawsuit to establish paternity; and
  • Criminal proceedings.

Likewise, if you have filed for bankruptcy in the previous year, the automatic stay will automatically terminate after 30 days. And if you have filed for bankruptcy multiple times in the previous year, the automatic stay will not take effect at all, absent a court order.

Creditors are also able to petition the bankruptcy court to lift the automatic stay. However, they must be able to provide a reason to the court as to why the stay should be lifted. Simply wanting to file a debt collection lawsuit will generally not be a sufficient reason.

Contact a Debt Collection Attorney Today

The Law Offices of Melanie Tavare are proud to defend members of Hayward and the surrounding communities against creditor lawsuits. If located in Walnut Creek, visit our other debt collection attorney page here. Having a creditor threaten a debt collection lawsuit can be a stressful experience; however, it is important to take act quickly and consult with an attorney before a judgment is issued in the lawsuit. To learn more about whether bankruptcy is a good option for you, contact the Law Offices of Melanie Tavare online or by calling us at 510-255-4646.

The Law Offices of Melanie Tavare is a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.