REALITY: Not only is this NOT true, it is one of main reasons to file bankruptcy. The minute you file bankruptcy, the Bankruptcy Court issues an order telling all of your creditors to leave you alone! No more phone calls. No more collection letters. No more lawsuits. No repossessions. No foreclosures. No garnishments. No method of collections is permitted while your case is under review. This order has a name. It is called the “automatic stay”; and it is issued pursuant to the Federal Bankruptcy Laws.
The automatic stay prohibits you from any and all collections activity. After you file bankruptcy, the creditor is not even allowed to talk to you. In addition, the creditor must stop any collection attempts already started. The automatic stay is very powerful, and puts the full weight of the United States Courts to work for you, to make sure your creditors leave you alone. If a creditor violates the automatic stay, you have the right to bring the creditor before the Court for Contempt of Court, and to be compensated accordingly. Very simply, once you file for bankruptcy, creditors must leave you alone or suffer the consequences.