Should I Tell Creditors That I Plan to File for Bankruptcy in Las Vegas?

Having an overwhelming debt, an account going into collections, or having a lawsuit filed against you can be stressful. 

Our Las Vegas bankruptcy and consumer protection attorneys at Freedom Law Firm are here to help. Over the past twenty years, we have helped thousands of people get out of debt. 

When deciding whether to tell creditors about your intent to file for bankruptcy, the most important thing to consider is what goal you are trying to achieve and how his disclosure may help or hurt you achieving your goal. 

When you just want the debt collection calls to stop. 

If you are overwhelmed by calls from creditors and debt collectors, one of the best things to consider is retaining a Las Vegas debt defense attorney who can send representation letters to creditors on your behalf. 

Once creditors or debt collectors know that you’re represented by an attorney, they are required to stop contacting you directly in regards to your debts or obligations – otherwise, they may be in violation of the Fair Debt Collection Practices Act (and owe you money for such violations!). 

A bankruptcy filing will put an automatic stay on most collection activities. 

If, after consulting with a Las Vegas bankruptcy attorney, you decide that bankruptcy is the right course of action for you, you need to know that the filing will trigger something called an “automatic stay.

As soon as your bankruptcy petition has been properly filed, an injunction called an “automatic stay” will be issued. It prevents creditors and debt collectors from contacting you and from collecting debts. It will also put a temporary hold on foreclosures, wage garnishments, utility disconnections, and evictions.

However, the automatic stay will not suspend all proceedings. Our bankruptcy lawyers at Freedom Law Firm will explain to you what proceedings won’t be affected by the automatic stay during your initial (free and confidential) consultation.

When you want to negotiate down the debt.

 Often people will try to negotiate an amount they can afford to pay before filing for bankruptcy. 

In our experience, people considering filing for bankruptcy in Las Vegas often have more than one debt with more than one creditor. If this is the case, you will usually want to be sure you can reach a deal with all of your creditors.

If you communicate to your creditors that you intend to file for bankruptcy, you will likely find out that creditors hear these things regularly and often respond with natural skepticism. There is a good chance that you may be asked to provide proof of your financial situation before the creditor will consider reducing your balance. Disclosing information or providing the requested documents without consulting with your attorney first may have negative consequences. 

The most important point to remember is not to ignore this matter. You have options and with the right advocate, many situations can be resolved likely with favorable terms. 

If you would like to find out what you can do to reduce your debt in Las Vegas and whether bankruptcy is the right option for you, please request a call-back by submitting a short online form. All initial consultations are free and confidential.