Creditor and collection agencies are a fickle group. While they can be relentless in their efforts, often making threatening statements, including litigation in order to garnish your wages, they do so in a way that bankruptcy is the farthest thing on your mind.
They may even tell you that once civil litigation is filed, even if you file bankruptcy, a judgment against you will not be affected by you bankruptcy.
This is only a half truth.
If a civil litigation verdict is rendered against you prior to you filing for bankruptcy: The judgment will stand up, requiring you to pay the debt, giving the creditor legal means of garnishing your wages, as well as paying court cost and both your attorney fees and that of the creditors. Additionally, the creditor may put a lien on real estate property that you own. If the debt remains unpaid, the creditor may also be able to have mounting interest on the outstanding debt of the judgment be included in the judgment. A judgment against you will go on your credit and may be a longstanding financial credit death sentence.
Filing Bankruptcy prior to a judgment against you: Even if a civil litigation debt claim is filed with the court, if you file for bankruptcy prior to a judgment being rendered, the civil litigation claim is automatically halted, pending the outcome of your bankruptcy claim.
If a creditor or collection agency threatens litigation, or you are served with debt litigation court papers, it is highly recommended that you immediately seek the legal advice and representation of an experienced bankruptcy attorney.
If is far better to file bankruptcy than to have a debt collection civil litigation judgment haunting you for years to come.
Brian Hizer and Edward Schimmel have the experience and resources to effectively guide you through the bankruptcy legal process. We always strive to provide the highest standard of legal representation to aggressively pursue your bankruptcy legal goals.
If you require experienced legal advice and representation from a qualified Bankruptcy Law attorney (lawyer), please call our offices to schedule a confidential legal consultation.