Will bankruptcy stop a credit card lawsuit?

Yes, a bankruptcy will stop a lawsuit. There's nothing worse than the sinking feeling that comes when a bank sues for credit card debt. The debtor now has to contend with the fact that their wages will be garnished and their credit rating shot for an untold amount of time. Alternatives for this situation are few, with bankruptcy being the only absolute solution to the problem.

The Automatic Stay and Lawsuits

The automatic stay stops all attempts at debt collection. A lawsuit is a form of debt collection, causing it to fall under the stay. There can be no further attempt to collect money from the debtor and, in a sense, the tables are now turned. If the collector were to try to pursue their case in court, they can now be sued by the debtor. In summary, filing a bankruptcy stops all collection activities whether it's a lawsuit or a collection agency. The debtor can lay claim to the rights that have been inferred upon them by the law.

Get Legal Help

If you're being sued by a creditor, it's time to talk to a lawyer. An experienced bankruptcy attorney can go over the case with you and explain your options clearly. Everyone's situation is different, to be sure, but there are certain ways to solve the problems. And these types of problems are best solved by hiring a lawyer.