You can use a bankruptcy to stop a lawsuit in most cases in Kansas. You need to sit down with one of our bankruptcy attorneys and go over the lawsuit and make sure it is the kind of claim that would be part of your bankruptcy case.
A lawsuit is a method used mostly by creditors to try and collect debts. It requires them to file a petition in the state court (sometimes the federal court) to try and get a judgement against you. Once they have the judgement they can take it and have a garnishment issued to your bank or employer to try and collect what you owe.
You will normally receive some kind of letter or notice from the attorney or collections company on the debt you owe before the lawsuit is filed. That letter will give you a limited amount of time to let them know whether or not you contest the debt that is owed. This is also how they contact you to see if payment arrangements are possible.
After about 30 days from receipt of the original letter the attorney’s office might file a lawsuit and serve you with it. Most people think that getting served with a lawsuit requires actual personal service, but that does not always happen. In many cases the lawsuit is served on your last known residence and in some cases by mail. Many of your clients tell us they never saw the lawsuit but only found out about it when they were garnished.
Most collections lawsuits in Kansas are done in the Limited Actions court. This is also called a Chapter 61 procedure. It is a streamlined process and often used on smaller credit card and medical debts or small loans.
A few lawsuits are filed in Chapter 60. These are cases where there is real estate or large sums of money involved. Foreclosures are filed under Chapter 60. The procedures to run a case through Chapter 60 are more detailed and more expensive than in Chapter 61.
In either case if you do not litigate the lawsuit, or if you litigate and lose, a judgement will be entered against you for the amount determined by the court. The attorney for the creditor can then use the judgement to legally garnish your wages, money in bank accounts, or seize other property that is not protected by law. They can also use the judgement to force you to come to court to answer their questions and give them information about you (such as where you work, where your bank accounts are and what property you own).
Most judgments from lawsuits for debt collection can be wiped out in a bankruptcy case. You can contact our office and one of our bankruptcy attorneys will sit down with you and explain how the bankruptcy will effect the lawsuit and what steps you need to take to stop any further collections actions. Even if the creditor already has a judgement you may have options to stop anything else from happening by filing a bankruptcy. This even includes stopping an ongoing garnishment.
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