What Happens When You File Bankruptcy?
- Shawn A. Stack
- 2 days ago
- 1 min read
Bankruptcy stops every action.
Everything freezes.
No more calls.
No more emails.
No more garnishees.
The idea is that you are given room to breathe and establish some order and rhythm in your life.
And this means that all of your creditors’ rights are suspended.
You still owe the debt to them, but they have no ability to do anything about it.
The debt goes away — and is uncollectible forever — once you complete your duties and receive your absolute discharge from bankruptcy.
It is a strange feeling of calm that can feel almost eerie.
All of the stress and anxiety of trying to figure out how to make payments to all your creditors vanish. And that familiar sense of dread fades to memory.
Bankruptcy is a rehabilitative process, and it starts day one when your creditors’ right to collect their debt is suspended.
The legal phrase is “Stay of Proceedings.”
The reality is dignity.
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