Individuals and corporations facing serious debt issues can look at bankruptcy as a remedy to these problems. To start with, bankruptcy eliminates collection lawsuits. The filing of a bankruptcy also can stop wage garnishments, prevent harassing telephone calls and stops your creditors from harassing you, and collection law firms from sending you harassing letters and making phone calls about paying your bills and taking legal action against you. Bankruptcy filings can be used to eliminate a variety of different types of debts. A bankruptcy filing can eliminate medical bills, credit card bills, personal loans and many other types of debts.
Debts Not Eliminated By Bankruptcy Filings
Certain types of debts cannot be discharged in Bankruptcy Court. These debts include child support, alimony (spousal maintenance), student loans (unless you can prove a hardship) and most tax debts. Court fines in criminal proceedings and penalties for driving while intoxicated or under the use of drugs in the State of New York also cannot be discharged in bankruptcies.
What Bankruptcy Does
The purpose of a bankruptcy filing is to eliminate debt issues. The filing of a bankruptcy gives you an automatic stay which stops credit harassment and collection activities against you. In addition, the filing of a bankruptcy stops foreclosure lawsuits, repossession actions and all eviction cases. Unfortunately, in some cases these proceedings are only temporarily stopped.
A Fresh Start
Article 2 of the United States Constitution reserves the right to Congress to make bankruptcy laws. Therefore, a Bankruptcy case is brought in the United States Bankruptcy Court. Federal courts are more powerful than State courts and have different jurisdictional requirements.
About the Author
Elliot S. Schlissel, Esq. and his firm have been filing bankruptcies for more than 35 years. Elliot and his staff of attorneys represent homeowners in foreclosure lawsuits, and they help homeowners obtain mortgage modifications. If you are having financial difficulties you can contact our office at 800-344-6431 or e-mail us at Elliot@sdnylaw.com for a free consultation.