28 N. 1st St., Suite 101, Geneva, IL 60134
331-222-7978
Should I File for Bankruptcy if I Am Sued by a Creditor?
Finding out that you are being sued by a creditor for unpaid debt can be extremely upsetting. Many people with debt try their best to repay it, but life circumstances and unexpected financial obligations get in the way. If you are being sued by a creditor, you may understandably worry about the consequences. Lawsuits like these can lead to wage garnishment, property liens, the seizure of assets, or other measures to collect the debt. Many people in this situation wonder whether they should file for bankruptcy.
Will Bankruptcy Stop the Lawsuit?
When someone files for bankruptcy, an "automatic stay" is issued which stops any collection efforts. This means that all debt collection activities must be ceased, including most lawsuits. Creditors cannot garnish wages, seize assets, or otherwise attempt to collect the debt until the bankruptcy case is concluded. Therefore, filing for bankruptcy often provides immediate relief from creditors and lawsuits - with a few exceptions. In some cases, a creditor can ask the bankruptcy judge to remove the automatic stay and allow them to proceed with their lawsuit.
Bankruptcy cases are complex and there are many different factors that influence whether bankruptcy will prevent legal action against a debtor. This is why it is so important to seek professional legal advice. An experienced bankruptcy attorney can help you determine if filing for bankruptcy will provide the relief you are looking for and how it would affect any existing lawsuits.
Bankruptcy Options in Geneva, Illinois
If you are overwhelmed by debt, being hounded by creditors, or being sued for unpaid debt, bankruptcy may be the best solution. There are two main types of bankruptcy available to individuals in this situation. Chapter 7 bankruptcy is designed for people who do not have the means to pay their debt and need a fresh start. Certain assets are liquidated or sold, and the proceeds are used to pay off the creditors. Chapter 13 bankruptcy is designed for people with a regular income who need an organized way to pay off their debt over time.
Contact Geneva Bankruptcy Lawyer Deanna L. Aguinaga Walker
If you are being sued by creditors or have overwhelming amounts of debt, bankruptcy may be right for you. Our Kane County bankruptcy lawyer has over 25 years of legal experience and she can help you evaluate your options and take steps toward financial freedom. Call DLAW, PC at 331-222-7978 and set up a free case assessment to get started.
Source:
https://www.investopedia.com/terms/a/automaticstay.asp
From our office in Geneva, Illinois, we serve clients throughout the region, including the communities of St. Charles, Batavia, Aurora, Elgin, Elburn, Sugar Grove, North Aurora, South Elgin, West Chicago, Fox Valley, Winfield, Wayne, Big Rock, Naperville, Wheaton, and Downers Grove, as well as other municipalities in Kane County and DuPage County.
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