One of the most difficult aspects of struggling with overwhelming debt is creditor harassment. This blog recently discussed the automatic stay during bankruptcy that can help provide some relief to struggling consumers and homeowners in North Carolina from creditor harassment but it is important for those seeking debt relief to be familiar with the full range of personal bankruptcy protections available to help them.
Because of the automatic stay protections, once the filing party has filed for bankruptcy protection, creditors are prohibited from pursuing further collection actions during the bankruptcy process. If the creditor violates these protections, the filing party may be able to pursue damages against them. Automatic stay protections are available in both Chapter 7 bankruptcy and Chapter 13 bankruptcy which are both personal bankruptcy options.
Specific prohibitions that apply to creditors once the filing party has filed for bankruptcy protection include prohibitions against continued harassment or abusive and threatening behavior; contacting the filing party by postcard; making false statements about the filing party’s debt; giving false credit information; threatening the filing party with arrest, seizure or the sale of their property or any legal action against them; notifying employers or co-workers that the filing party owes money; or garnishing the filing party’s wages without following the court process in North Carolina.
In addition, creditors are prevented from using a false company name; misrepresenting themselves or misrepresenting documents as from the government; collecting interest on past-due debts; or depositing post-dated checks. Wide-ranging protections are available to struggling consumers through the bankruptcy process which is why struggling consumers should be familiar with what they are and the ways they can help them with creditors and get set up with a fresh financial start.