If you are struggling with debt, you are well aware of this timeless fact: creditors are relentless in their pursuit of money. They are willing to engage in all manner of collection efforts, including harassing letters and phone calls to get what they believe they are owed. Sometimes, creditors will even file lawsuits against debtors.
When you file for bankruptcy protection, the automatic stay prevents creditors from filing lawsuits against you. However, there is a procedure within the bankruptcy court called filing an "adversary proceeding," which is a lawsuit that is filed within your bankruptcy case. An adversary proceeding addresses issues that are more complex than what can be accomplished by filing a motion with the court.
Many people file for bankruptcy protection because they need relief from their creditors. A personal bankruptcy filing can be shelter from the harassing collection efforts of debt collectors. However, while rare, it is possible for a lawsuit to be filed against you in your bankruptcy case. This type of action is commonly referred to as an "adversary proceeding."
The U.S. District Court for the District of New Jersey recently held in Lewis v. Portfolio Recovery Associates, LLC, that a debtor's failure to list a lawsuit as an asset of his bankruptcy estate resulted in his loss of the right to claim violations of the federal Fair Debt Collection Practices Act (FDCPA) and the New Jersey Truth in Consumer Contract Warranty and Notice Act (TCCWNA).
you have been struggling financially for a long time now, you may be wondering how you will know when it is time to seek bankruptcy protection. Although no two situations are the same, below are some of the top reasons you should consider filing a Chapter 7 or Chapter 13 case:
Many people ask us if filing bankruptcy can help them with a lawsuit. In most cases the answer is yes!