Tuesday, December 24, 2013

Violations of the Automatic Stay

If a creditor in your Bucks County bankruptcy continues to harass you, what can be done?

If you are filed, you are protected by the Automatic Stay.  I always like to say that the automatic stay is "sacred" in the bankruptcy code as it provides one of the main benefits of filing for a Bucks County bankruptcy -- you can be free of creditor harassment.

If however, an individual is injured by a willful violation of the automatic stay, they may recover actual damages, including costs and attorney's fees, from the creditor who violated the stay.  There is also potential for punitive damages when appropriate.

Under Section 362(h) of the bankruptcy code, damages may be recovered if the creditor knew of the stay and its actions were intentional.  Frequently, this is proven by showing the creditor listed on the petition and showing evidence of their continued violations.  Moreover, additional letters from the bankruptcy attorney to the creditor is helpful.

I just had this situation with a person from Feasterville.  He was sued by a creditor who was definitely listed on the bankruptcy petition.  I wrote a short, terse, and scary letter to the attorney representing the creditor.  In rapid fashion, the attorney withdrew the suit.  Why was the suit withdrawn so quickly?  Because the attorney knew the power of the automatic stay.

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