Will filing for bankruptcy stop a lawsuit?

Filing for bankruptcy in Virginia can stop a lawsuit in certain circumstances. Generally speaking, if you file for bankruptcy in the state of Virginia, it will create an “automatic stay” that prohibits creditors from initiating or continuing any legal action against you. This “automatic stay” is put into place upon the filing of the bankruptcy petition and stops most lawsuits from moving forward in the state court system. In many cases, creditors may be barred from proceeding with collection actions that had been started prior to the filing for bankruptcy because of the automatic stay. This includes things such as garnishments, foreclosure proceedings, and other lawsuits. However, not all lawsuits are stopped by filing for bankruptcy. Secured creditors, such as mortgage lenders, may be able to continue foreclosure proceedings. In addition, the court may lift the automatic stay in some cases, allowing creditors to continue proceedings. Bankruptcy is a powerful tool to help people who are facing financial difficulty. However, it is important to remember that filing for bankruptcy will not necessarily stop all lawsuits. It is important to speak with a qualified bankruptcy attorney to discuss your particular situation and determine the best course of action for you.

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Will filing for bankruptcy stop a lawsuit?

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