Bankruptcy Can Provide Immediate Help for Struggling Debtors During the COVID-19 Crisis

Millions of Americans have been left unemployed as companies close their doors or reduce operations due to the coronavirus pandemic. While protecting public health and saving lives remain the utmost priorities, this is cold comfort for people struggling to meet their living expenses without an income. However, there are legal remedies that you can turn to if this crisis has forced you into financial straits.

One course of action is filing for bankruptcy. Despite the pandemic, bankruptcy courts across the country and here in DeKalb County, Georgia remain open, operating with modified schedules and procedures. You should consult with a qualified attorney to explore whether bankruptcy is a viable solution for your financial problems.

Once you file for Chapter 7 or Chapter 13 bankruptcy, an automatic stay goes into effect, prohibiting creditors from taking collection actions while the bankruptcy case is pending. In fact, creditors must not contact you at all. This provides immediate relief for debtors who are being hassled by calls from collections agencies and by threats of lawsuits.

Furthermore, if there is already a lawsuit pending against you, there is a good chance the automatic stay will halt it. An automatic stay cannot halt some types of legal actions, such as those pertaining to divorce or criminal cases. However, it can halt lawsuits seeking to collect on credit card accounts, installment loans and similar debts.

The automatic stay can also protect debtors from losing their homes. If you’re facing eviction, filing for bankruptcy can stop the proceeding. Similarly, homeowners who file for bankruptcy protection can have the foreclosure case stayed.

If you’re not ready to file for bankruptcy, there are other financial solutions to consider, such as:

• Contacting creditors to request a loan deferment
• Filing for unemployment benefits via the Georgia Department of Labor
• Use the IRS portal to enter your direct deposit information to receive your Economic Stimulus Payment. Eligible individuals can receive $1,200 or $2,400 for those who are married, filing jointly.
• If you owe taxes, you may delay payment until July 15. You may also request a payment plan.

Unfortunately, these are still short-term solutions. For long-term debt relief, filing for bankruptcy may be the best option for some debtors.

The bankruptcy lawyers at Jeff Field & Associates in Scottdale, Georgia remain committed to assisting people undergoing financial difficulties during this challenging time. We provide personalized, solutions-focused legal guidance via video and phone conferencing for new and current clients. Contact us online or call 404-381-1278 to request a free initial consultation to find out if filing for bankruptcy could be right for you.