Generally, YES. Filing for bankruptcy will provide a debtor relief by granting the debtor an automatic stay. The automatic stay requires all collection activities to stop. A law suit, such a lawsuit for unpaid credit card or medical bills, is a civil proceeding and a form of collection action and is, thus, subject to the automatic stay provision afforded to debtors who file for bankruptcy.
Civil law suits allow the defendant/debtor only a short amount of time to respond to the served complaint/law suit. Failing to do so, may subject the debtor/defendant to a default and thus, further collection actions, such as wage garnishments, bank levies, and/or liens on real and personal property. Thus, if served with a law suit, it is crucial the defendant/debtor immediately seek legal representation, especially a highly skilled bankruptcy attorney who can assess whether filing for bankruptcy relief is in the defendant/debtor’s best interest.
Filing for bankruptcy is a complex process and requires proper planning to determine whether it is best for you. Thus, it is crucial that you select a highly skilled bankruptcy attorney. I make it my goal to provide each client the dedicated time and experience to assist the client with his/her bankruptcy.