How many bites can a creditor take out of a bankrupt consumer?

Bankruptcy lawyer Wendell Sherk recently wrote a nice article about what he called the “one-bite rule” in bankruptcy. Simply put, this is not a real rule, but the notion that creditors can get away with a little bit of harassment even after a bankruptcy case is filed — one last bite of the apple, so to speak, before abandoning collection efforts.

Now lets be clear that the actual bankruptcy code allows no such thing — as soon as your case is filed, creditors are prohibited from contacting you, whether by phone, mail, or any other way. But creditors may think that the damages they face for a “small” violation of the law makes one final collection attempt worth the risk.

What to do about this problem? Well, you can always sue the creditor and make them pay small damages for a “small” violation.

But here in the Massachusetts / New Hampshire / Merrimack Valley area, what I tell my bankruptcy clients to do first is very simple: ANSWER THE PHONE. As soon as your case is filed, and you have the docket number, write it down next to your phone (or enter it in your cell or PDA). Then answer the creditor calls one by one, telling each that you have filed bankruptcy case number 123456.

This method negates the one-bite problem, and you will notice the level of calls dropping much quicker than if you kept avoiding them.

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