If you made the choice to file for bankruptcy, it is probably because you feel you are in a place where you can no longer manage your financial obligations on your own. Another reason may be the constant contact from creditors and debt collectors, which can cause you additional stress as you try and find a way out. You may believe that filing for either Chapter 7 or Chapter 13 could provide you with the opportunity to secure a better future. 

One of the benefits of filing for consumer bankruptcy is that it will enact the automatic stay. This halts contact from debt collectors and stops collection efforts against you. The automatic stay is one of the many reasons why bankruptcy could be the right way forward for you and your family. If you are not sure how you could ever deal with your debt on your own, you may want to learn more about how you can deal with some types of debt once and for all.

Specifics of the automatic stay

The automatic stay goes into effect as soon as you file for bankruptcy. This means that you will enjoy a respite from the constant phone calls you’ve been receiving and other efforts enacted by debt collectors and creditors to get money from you for your past-due bills. What the automatic stay will do for you depends on various factors, including the type of debt you have and what collection efforts you are dealing with. Some of the ways it may help you include:

  • It can keep your utilities on if you are behind in your payments.
  • It can keep the bank or a creditor from moving to repossess your personal vehicle.
  • It can stop garnishment of your paycheck.
  • It can halt the process of foreclosure on your home.
  • It can stop the process of your landlord trying to evict you from your home.

While there are many benefits to the automatic stay, there are limits to what this process can do. For example, it cannot stop proceedings against you related to back taxes you owe. It also cannot help you with actions related to unpaid child support or issues related to criminal proceedings against you. 

Before you file for bankruptcy, you may want to speak with an Oregon attorney regarding the benefits you can expect from the automatic stay and the rest of the bankruptcy process. When you know these things, you can proceed with confidence with the appropriate steps.