When you file for any type of consumer bankruptcy, the court issues an automatic stay immediately. This stay gives you protection against debt collectors.
According to Cornell Law School, the automatic stay prevents debt collectors from collecting the debts you owe.
Protections
When you file your petition for bankruptcy, the court will order the stay. At this point, anyone trying to collect a debt from you for any type of debt must stop all collection actions. This includes someone who has a judgment against you or a lien against your property.
The debt collector cannot take any action whatsoever. They must stop calling you or contacting you in any way. In addition, they can no longer take money from you, such as a garnishment.
Creditor options
Your creditors will get the chance to speak to the court during your bankruptcy proceedings. The court allows them to have a say if they feel you could pay the debt.
Important notes
You should note the automatic stay does not apply in some cases. It will not apply to a child or spousal support orders. You must continue paying for these. A government entity may also be able to collect taxes from you or pursue collection actions for tax debt as well.
If you have a secured debt where you wish to keep the property securing it, such as a car loan, you may also wish to continue making payments. However, if you do not, the lender cannot take action as long as the stay remains in place.
The court will lift the stay as soon as it discharges your bankruptcy case. At that time any debts you did not clear are available for creditors to resume collection activities.