Wednesday, June 14, 2017

Is It Too Late To File Bankruptcy If I Am Being Sued?

When debts spiral out of control and not even the minimum payments are being made, it does not take long for your lenders to start collection efforts. This might begin and end with phone calls and letters, but can also include legal action. If you are sued for a past due debt you have several options. First and foremost you will need to file an answer to the lawsuit, because if you do not the lender will obtain a judgment against you. Once a judgment has been entered, the lender is free to pursue whatever collection remedies are legally available, up to and including garnishment of wages or bank accounts. This result might be the case even if you did file an answer, because the Court may have found that your answer did not raise a valid defense and the creditor was entitled to judgment. In either instance you are probably wondering what can be done to put an end to the collection efforts, so your hard earned wages are not taken from you.

At this stage of the game you should consider filing for bankruptcy. It is not too late! In fact, filing for bankruptcy is a good idea at this very juncture in the matter because:

         You get the benefit of the automatic stay the instant you file, which will put an immediate end to garnishments.
         The automatic stay will also prohibit a creditor from starting a new lawsuit against you.
         If a lawsuit is pending, meaning judgment has not yet been entered, filing for bankruptcy will prevent a creditor from asking the Court to enter judgment.
If you are being sued for debts you are not able to pay, let us help. We will let you know your bankruptcy options, and help you to understand how filing a bankruptcy case can eliminate or reduce your debts. Once a bankruptcy case is filed, you will have the time needed to take a breath and get back on track. Bankruptcy is designed to give you a fresh start, which is just what you need if you have been sued and are unable to pay the judgment amount.
If you have more questions about money management, bankruptcy and debt, contact our office. We can be reached by phone, or online at

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