Although bankruptcy is an easy legal process to navigate, it may nevertheless cause a lot of emotional strain on those involved. Having someone sue you is the one thing you want to avoid. Many debtors resort to bankruptcy protection against creditor lawsuits. A bankruptcy filing will stop most creditors from suing you or even contacting you, but it won’t guarantee you’re safe from all claims. Consider taking Help from a bankruptcy attorney.
Litigation Against Another
Whenever a creditor files an adversary process as part of your bankruptcy case, they are likely contesting your request to have the debt written off. The creditor, often known as the “Plaintiff,” will claim that the debt you owe them does not qualify for discharge or that you accumulated the debt unlawfully, both of which will prevent the debt from being written off.
Bankruptcy fraud can occur, for instance, if a debtor makes a substantial purchase right before filing for bankruptcy under the false assumption that the debt will be erased and the debtor will not be responsible for paying the purchase. The creditor may file an adversary proceeding to present their case and reclaim their ability to sue you.
Non-Debt Related Legal Actions
Individuals might be subject to several forms of legal action, consumer debt litigation being only one of them. Even if you declare for bankruptcy, the person you owe child support to might still sue you for the money. However, if you are facing criminal charges, filing for bankruptcy will not put a stop to those processes.
Being Sued Following the Issuance of an Automatic Stay
When you file for bankruptcy, no matter what chapter, a court will immediately order a stay to prevent any further collection actions. Because to the automatic stay, no creditor or debt collector can attempt to contact you about the debt they are owed. A creditor who is unaware of the automatic stay may nonetheless try to bring a case against you in a court other than the bankruptcy court. Creditors who are trying to collect debts from you while your bankruptcy is still pending should be informed that you have filed for bankruptcy. Legal action and other attempts at debt collection against you will likely be dropped immediately.