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The bankruptcy automatic stay can do a lot for you

Nobody wants to file for bankruptcy, but if you find yourself in this position it's good to know the many benefits that can improve your finances and help you feel better about the future.

The automatic stay is one of the "hidden gems" of bankruptcy. Once you file for Chapter 7 or Chapter 13, this goes into effect as a means of protecting you from bill collectors and creditors. It also prevents anyone seeking money from you from filing a lawsuit.

Here is a short list of some of the many things the bankruptcy automatic stay can do for you:

-- Keep your utilities active. This is something that many people worry about, but the automatic stay can help. With this, you will buy yourself a minimum of 20 more days, which may give you enough time to figure out a way to make things right with your utility companies.

-- Stop foreclosure. There are many reasons to consider bankruptcy, with the ability to stop foreclosure one of the best. If your bank is already moving forward with foreclosure proceedings, the automatic stay will stop the process from proceeding for the time being. This can also help stop an eviction if you are a renter.

-- Stop wage garnishment. Are you currently losing some of your paycheck to wage garnishment? Once you file, you won't have to worry about this any longer. Your wage garnishment is lifted for the time being, meaning that you can once again collect your entire salary.

Bankruptcy may be a scary process, but it's good to know that the use of the automatic stay can help improve your situation in a number of ways.

As you review your finances and consider your options, don't be shy about learning more about both Chapter 7 and Chapter 13 bankruptcy. With either one of these you can improve your life, especially once the automatic stay kicks in.

The automatic stay is not the only reason to file for bankruptcy, as there are other points to consider as the process moves forward, but this is something that can improve your situation from the day you file. There's a lot to be said for that.

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