Myth #2 If you have been SUED by a creditor it is TOO LATE to file for bankruptcy.

Myth #2: If you have been SUED by a creditor it is TOO LATE to file for bankruptcy.

Truth: Bankruptcy can stop a wage garnishment, foreclosure, sheriff sale and/or lawsuit through the Automatic Stay under section 362 of the Bankruptcy Code .  This Section of the Bankruptcy Code states all creditors of a debtor to cease collection activities. There is little exception to this section of law.  In most cases it stops a lawsuit or judgment collection in its tracks.