Oklahoma Bankruptcy Law - How Oklahoma Bankruptcy Law Can Stop Creditors from Harassing You

Oklahoma Bankruptcy Law - How Oklahoma Bankruptcy Law Can Stop Creditors from Harassing You

If someone is to the point they are considering bankruptcy, then they know what it is like to be constantly harassed by creditors trying to get paid. This harassment can be in the form of letters, constant phone calls, or any other number of acts. This harassment can cause the debtor stress and frustration, to the point where it can even begin to affect the debtor's physical and mental health. This is where Oklahoma bankruptcy can be helpful.

The moment a debtor files for Oklahoma bankruptcy, the creditors are barred from harassing the debtor. This is known as the "automatic stay." In effect, the automatic stay deems all creditors' attempts to collect on a debt illegal, unless the Bankruptcy Court has given a creditor express permission to continue attempts to collect the debt.

When Does the Automatic Stay Go Into Effect?

The automatic stay is effective when a debtor files a petition for Oklahoma bankruptcy. This means that as soon as a debtor files the petition, creditors are barred from contacting the debtor, and a host of other collection attempts.

How Far Does the Automatic Stay Extend?

The Bankruptcy Code specifically lists the acts and actions creditors can no longer attempt. This list is very comprehensive, and encompasses almost any possible creditor collection attempt. There are exceptions, but these are very narrow, and each situation needs to be examined by an Oklahoma bankruptcy attorney to determine whether these exceptions may apply.

When Does the Automatic Stay End?

There are two common situations where the stay automatically ends. The first and most common situation occurs when the Oklahoma bankruptcy case is closed, dismissed by the Bankruptcy Court, or the debtor receives a discharge of his debts.

The second situation occurs when there is property that is no longer considered part of the bankruptcy estate. One example of this is where the debtor owns a building on which there is a mortgage. While the building is owned by the debtor, it is part of the bankruptcy estate. Because of this, the mortgage holder cannot attempt to collect on this debt. But if during bankruptcy the building is sold to another party, then the building is no longer part of the bankruptcy estate. Now the mortgage holder can attempt to collect on the mortgage from the party who owns the building now.

The Bankruptcy Court can also grant an "interested party" relief from the automatic stay, which would allow that party to attempt to collect on the debt. The Bankruptcy Code specifically lists situations where the Bankruptcy Court can grant relief from the stay. Each debtor's unique situation should be examined by an Oklahoma bankruptcy attorney, to determine if creditors in the debtor's case might be able to obtain relief from the stay.

Oklahoma bankruptcy can stop creditors from harassing a debtor for payment. The vast majority of debtors get relief under the automatic stay from the harassing calls, letters, and other collection attempts, by filing a petition for Oklahoma Bankruptcy. However, each debtor's situation is unique and should be examined by an Oklahoma bankruptcy attorney to ensure the automatic stay will apply to them before making the decision to file for an Oklahoma bankruptcy.

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