Can Creditors Try to Collect a Debt After Bankruptcy in Pennsylvania?

In most cases, creditors cannot try to collect a debt during or after bankruptcy in Pennsylvania. During bankruptcy, a stay may be put on these efforts from creditors. After bankruptcy, debts that have been discharged do not need to be paid, and creditors cannot harass you for payment.

If an automatic stay takes effect after you file for bankruptcy in Pennsylvania, a creditor cannot try to collect payment for protected debts from you. A stay does not protect certain debts, like alimony and child support. Automatic stays are not guaranteed for all debtors depending on their bankruptcy filing history, and creditors might attempt to lift an automatic stay during bankruptcy. If dischargeable debts are erased during bankruptcy, creditors cannot contact you once the process is complete to request repayment, as you are not legally required to repay them.

Reach out to our Pennsylvania bankruptcy lawyers by calling Young, Marr, Mallis & Associates at (215) 701-6519 to schedule a confidential and free case evaluation today.

When Can’t a Creditor Try to Collect a Debt After You File for Bankruptcy in Pennsylvania?

After a debtor files for bankruptcy in Pennsylvania, an automatic stay on debt collection will likely take effect immediately. This prevents creditors from harassing debtors for payment, alleviating debtors from that stressor while sorting out their financial matters.

People in Pennsylvania might experience constant calls and communications from creditors demanding payments when dealing with debt. Not only can this be overwhelming, but it can also cause debtors additional stress and fear. Because this behavior is not conducive to repayment, it is typically forced to stop during bankruptcy.

In many cases, filing for bankruptcy creates a pause on debt collection from creditors. This means that a creditor cannot contact you or make any collection efforts for certain debts while you are in bankruptcy in Pennsylvania. The stay will last for the duration of your bankruptcy as long as you meet the requirements of the process. All communications have to go through our West Chester, PA bankruptcy lawyers and the court, and creditors cannot try to collect payment from you personally during this time.

A stay will stop only certain creditors from contacting you and cease any concerning attempts to collect debts, such as foreclosure and repossession of property. Knowing that an automatic stay will provide immediate relief is why many debtors file for bankruptcy in Pennsylvania instead of simply trying to repay creditors themselves.

Are All Pennsylvania Bankruptcy Filers Protected from Attempts to Collect Debt from Creditors?

Unfortunately, while a stay on collection efforts is available to most debtors in Pennsylvania, it is not available to all. This benefit typically applies to debtors without long histories of filing for bankruptcies. If you are not granted a stay, a creditor will not be prevented from trying to collect a debt while you are in bankruptcy in Pennsylvania.

In some cases, creditors are still permitted to contact debtors during bankruptcy. An automatic stay is a privilege of sorts reserved for certain debtors. If you have priority debts, namely child support and alimony, those debts may not be protected by a stay. This means you might continue receiving calls or communications requesting that you pay amounts you owe for certain debts while you are under bankruptcy in Pennsylvania.

In addition to not preventing debt collection on all types of debt, stays are not guaranteed for all types of debtors. If you have filed for bankruptcy several times in the past year, our attorneys might have to file a motion to grant a stay on debt collection, as one will not be given automatically. For debtors that have filed for bankruptcy twice in the past year, an automatic stay will go into effect but will only last for 30 days. In this case, we can file a motion to extend a stay so that you can continue benefiting from no contact from creditors while you are under bankruptcy.

Can Creditors Motion to Relieve the Stay on Attempts to Collect Debt During Bankruptcy?

Although bankruptcy provides a path to debt collection for creditors, some might be anxious to recover the amounts owed to them. In these cases, creditors might attempt to lift a stay, which might make bankruptcy more difficult for you.

Creditors might motion the court to lift a stay. Should this happen, you might be back where you started, dealing with harassing communications from creditors while trying to get your finances in order through bankruptcy. Our attorneys can argue against a motion to lift a stay and demonstrate how doing so will not allow creditors to seek repayment sooner. Filing for bankruptcy is a process that, if interrupted by a lifted stay, might be disrupted and cause issues for both creditors and debtors alike in Pennsylvania.

Certain creditors might be more or less likely to take this action. For example, car or mortgage lenders are typically the creditors that most often motion the court for this outcome. This means that if you are behind on mortgage or car payments, you might face a motion to relieve a stay while you are under bankruptcy in Pennsylvania.

What if a Creditor Tries to Collect Discharged Debts After Bankruptcy in Pennsylvania?

If you are eligible for an automatic stay while under bankruptcy, certain creditors cannot contact you in any way to try and collect debts. Should they, they might disrupt bankruptcy proceedings and delay their repayment.

If a creditor contacts you in an attempt to repossess property or seek repayment while you are benefitting from a stay in Pennsylvania, inform the court. This action is prohibited, and our Upper Darby, Pa bankruptcy attorneys can take the necessary actions to help you regain property or seek damages from a lender that has violated a stay.

During bankruptcy, certain debts may be discharged. This alleviates a debtor from paying back certain creditors previously owed amounts. Even being made aware of this, a creditor might attempt to contact you to collect a debt that has been discharged. Should this happen, you may be able to seek damages against the creditor, who might also face additional legal ramifications for contacting you for debt collection of debts discharged in bankruptcy.

Contact Our Lawyers About Your Bankruptcy Case Today

Call Young, Marr, Mallis & Associates at (215) 701-6519 to set up a free case evaluation with our Philadelphia bankruptcy lawyers today.