When you file for bankruptcy, an automatic stay goes into effect. The stay means that all collections activity, including legal actions, garnishments, calls, and letters, must stop. If a collection attorney continues to contact you in violation of the stay, he or she may be breaking the law. Learn more about what collection attorneys can do after a bankruptcy filing and what you can do if violations occur.
Exceptions to the Stay
While the automatic stay applies to most situations, there are a few exceptions. To determine if the collection efforts violate the stay, you need to understand first whether or not the stay applies to your circumstances.
- Criminal proceedings do not stop because of a bankruptcy stay.
- Some child support and alimony actions can continue after a bankruptcy filing.
- Certain types of evictions may continue in spite of the automatic stay.
- A collection attorney can still pursue you for debts you incur after the filing of the bankruptcy.
- You still have to make your federal student loan payments and most tax payments.
In some cases, the bankruptcy court may terminate or modify the stay to allow creditors to pursue you for certain debts. If this has not happened, and none of these exceptions apply, you may be dealing with a collector who is pursuing you in violation of the stay. Your bankruptcy attorney can help you determine if you are experiencing a breach of the law.
What to Do About Violations
If a collection attorney contacts you and you believe it is a violation of the stay, the first step is to make sure the creditor is aware that you filed for bankruptcy. If the creditor was unaware of the filing, informing them should be enough to stop the contact and correct itself. If the collection attorney keeps violating the stay, your next step is to report this to the bankruptcy court, which can issue sanctions, such as attorney’s fees and fines, for intentional violations.
If neither of these steps works, you may have to file a lawsuit. A knowledgeable attorney can help you with this. The violation of the stay may also violate state and federal laws such as the federal Fair Debt Collection Practices Act and the Fair Credit Reporting Act.
Bankruptcy can be a complicated process, and understanding what a collection attorney can and cannot do after a filing can be difficult as well. Contact an experienced attorney, like a bankruptcy law firm in Oklahoma City, OK, in your area who can help you through it and protect your rights.
Thank you to the experts at MartinWren, P.C. for their input into bankruptcy law.