Overwhelming debt is stressful, but constant calls, texts, and threatening letters from creditors can wreak emotional havoc on yourself and your family.
While it is legal for creditors to attempt to collect a debt, there are federal laws that prohibit collectors from using harassment techniques. For example, creditors cannot call at odd hours, intimidate you, or threaten wage garnishment, repossession, foreclosures and lawsuits.
To stop this type of creditor harassment during your Salt Lake City bankruptcy, call a skilled attorney who can offer valuable advice.
When a creditor files a lawsuit against you, you must first decide whether the charges of nonpayment are valid. Ask yourself these questions:
If you answered yes to any of these questions, then you are not legally required to pay the debt. But if the charges of nonpayment are valid, then you should consider filing for bankruptcy. When you do, an automatic stay kicks in to stop creditor harassment immediately.
When you file bankruptcy, creditors receive notice, or an automatic stay, to immediately stop all actions to collect a debt. Collection phone calls, letters, and emails stop. Lawsuits, foreclosures, liens, or wage garnishments are frozen until the bankruptcy case proceeds through the legal system. The idea is to give you some breathing room from creditors. And if contact continues, your local bankruptcy attorney can involve the courts to stop the harassment.
There are two types of bankruptcy you can file:
Chapter 7 bankruptcy, also known as liquidation bankruptcy, is when you can no long pay any outstanding debts. A sudden job loss, significant illness with inadequate health insurance, or astronomical credit card debt are common reasons for Chapter 7 bankruptcy. With this type of bankruptcy, are required to pay creditors the value of your non-exempt assets. To see a complete list of assets protected from creditors under Utah law, check out our comprehensive report on Utah exemptions. To file this type of bankruptcy, your income must not exceed the Utah median income, or you must pass the Means Test.
What is Utah’s median income? Utah’s median income figures are updated by the Office of the United States Trustee every six months. As of November 1, 2020, Utah’s median is as follows:
| Utah’s Median Income | ||
| as of 11/1/2020 | ||
| Household Size | Gross Annual Income | Gross Monthly Income |
| 1 | $66,445 | $5,537 |
| 2 | $72,855 | $6,071 |
| 3 | $85,507 | $7,126 |
| 4 | $95,430 | $7,953 |
| 5 | $104,430 | $8,703 |
| 6 | $113,430 | $9,453 |
| 7 | $122,430 | $10,203 |
| Each Add’l | $9,000 | $750 |
Chapter 13 bankruptcy, or reorganization bankruptcy, requires you to create a plan to reorganize your debt payments. You can do things like bring your delinquent mortgage current and reamortize your car loans over 60 months at a very low rate of interest. You often only have to repay a fraction of your general unsecured debts, like credit cards and medical bills. Your assets are not seized and sold under this type of bankruptcy.
Are you being hounded by creditors? If so, it’s time to call a professional. Our experienced lawyers can handle your bankruptcy case and make the creditor harassment go away. Contact our firm today to schedule a free consultation and learn more about stopping creditor harassment during bankruptcy in Salt Lake City.
