When you file for bankruptcy in NYC, you do not have to take any more steps to notify your creditors of your actions. The court will contact all the creditors that you listed in the bankruptcy filing and inform them that they cannot take any legal action against you during this time. However, there are some cases in which you may need or want to inform creditors yourself. Here’s why and how:
Stop the Harassment
It can take creditors several weeks to receive and process the bankruptcy notice from the court. In the meantime, you’ll still be getting those daily or nightly calls that prompted you towards filing in the first place. According to bankruptcy law, verbally informing a creditor of bankruptcy over the phone is every bit as binding as a written notice. As soon as a creditor has been notified of a bankruptcy filing, it is illegal for them to contact you. They must now go through the court with the bankruptcy case to protect their interests.
If the creditors continue to harass you via mail instead of the telephone, then return their bills with a notice that you have filed for bankruptcy, and that they can no longer contact you legally. If you have a copy of the court notice, you can attach it, but it is not necessary. Once again, the statement is binding providing you have actually filed for bankruptcy. If the mailings continue after this one, send the letter to your lawyer.
Creditors You Didn’t List Don’t Apply
If you did not list a creditor in the bankruptcy case, or a creditor could not be included, then your bankruptcy filing means nothing to them. They can continue to seek payment, including taking you to court for wage garnishments or settlements.
This is good incentive to be as thorough as you can on your bankruptcy filing. Do not leave any creditor out to save face, and do not let any creditor, no matter how small, slip your mind. If they aren’t listed, you aren’t protected from them.
Should You Tell Them Before You File?
In most cases, it is best to not tell creditors you plan to file for bankruptcy. If they write off part of your debt in an attempt to get you to pay up, then you’d have to report that write off on your taxes, and if you do end up filing for bankruptcy later. Additionally, an unscrupulous creditor may hurry to take you to court before you can file for bankruptcy.
However, if you have personal reasons for informing them of the plan to file for bankruptcy, it is better to do so after you have chosen your bankruptcy lawyer in NYC. Most creditors will immediately turn you over to the legal department after learning your plans, and you’ll be able to refer them to your lawyer instead of dealing with their calls yourself.
Be Specific and Quick
If you do have to talk to any creditor about your bankruptcy, the key things to keep in mind are to be specific, and to be quick. Simply give them the specific date on which you filed for bankruptcy, inform them that the trustee will be contacting them when the determinations regarding payment have been made, and give them your lawyer’s contact information. Nothing else needs to be said or done to make a legally binding arrangement.
Tired of dealing with harassing creditors on your own? You can get rid of them for good. To get started on your bankruptcy filing in NYC, call my office at 212-244-2882.