Creditors: What They Do and How a Bankruptcy Lawyer Can Help You

The phone rings and the hairs on the back of your neck stand up. You know it’s a creditor on the other end of that phone, and you can’t help but feel scared. Don’t let panic get the best of you. Take a moment to get a better of understanding of what creditors do and how a bankruptcy lawyer in Surprise, AZ can help.

The Role of the Creditor

A creditor holds the debt that you owe. For instance, if you owe Capital One money, Capital One is the creditor. If you fail to pay your debt on time, the creditor will take actions to collect the money. Creditors can send letters and make phone calls in an effort to get the money. If they do not have a satisfactory outcome, they can hire a collection agency to collect the debt for them or file a lawsuit.  The creditor may also sell your debt to a third party collection or factoring company who will try to collect and take legal action.

As frightening as that sounds, all hope is not lost. While a creditor or a collection agency can threaten to garnish your wages if you don’t pay by Friday, the actual ability to garnish your wages will take at least 45 days after your are officially served with a complaint.  This gives you the time you need to speak with bankruptcy lawyer in Surprise, AZ.

With respect to collection agencies, there are limits to what they can and cannot do in order to collect a debt.  The Fair Debt Collection Practices Act protects you from certain collection agency abuses, and limits how collection agencies can contact you.  Violation of the “Act” can result in strict liability and damages being assessed against the creditor, including paying your attorney’s fees.

Bottom-line, a bankruptcy lawyer in Surprise, AZ can help you deal with creditors and protect your rights.

The Automatic Stay

First, your bankruptcy lawyer in Surprise, AZ can help you get an automatic stay. An automatic stay will stop creditors from taking any actions against you. An automatic stay occurs when you file Chapter 7 or Chapter 13 bankruptcy. This process can keep you in your home, behind the wheel of your car, and with utilities. It can also keep you from being sued by the creditor.

Negotiating Debts

The automatic stay is just one of the benefits of having a lawyer work with you when you file Chapter 7 or Chapter 13 bankruptcy. The bankruptcy lawyer in Surprise, AZ can also negotiate a settlement so you won’t have to pay the full amount that you owe. These lawyers know how to work with creditors so they are much more effective at negotiating than average citizens are.

If you are sick of panicking every time the phone rings, it might be time to contact a bankruptcy lawyer in Surprise, AZ. Your lawyer will stand by your side and help you settle your debt so you can move forward with your life. Whether you want to file Chapter 7 or Chapter 13 bankruptcy, your lawyer will come up with a plan to make it happen so you can free yourself from debt.


This blog is intended as a general discussion of legal issues and not as a statement of fact, legal advice or a legal opinion. No attorney-client relationship is created by this blog. Do not act or rely upon law-related information in this communication without seeking the advice of an attorney licensed to practice in the relevant area.

This blog article was created by Larry P. Karandreas, Esq., on behalf of the Law Offices of Larry P. Karandreas, P.L.L.C., A Lawyer Who Cares™, which concentrates its practice of law to Chapter 7 and Chapter 13 Bankruptcy, and in Debt Negotiation. If you live in or near Phoenix, Glendale, Scottsdale, Peoria or the Surprise, Arizona area and want legal advice or help – please visit the firm website for more information. 
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