When Does the Automatic Stay Take Effect?
For many debtors who file for bankruptcy, one of the initial and significant benefits of a bankruptcy filing is the automatic stay. The automatic stay is an injunction that stops creditor and debt collection actions against the debtor who has filed for bankruptcy. Many debtors are relieved to have the protections of the automatic stay because it prevents any existing debt collection actions from continuing (from ongoing phone calls from creditors to existing lawsuits or foreclosures), and it also prevents creditors and debt collectors from taking any new action against the debtor (such as filing a lawsuit against the debtor or having the debtor’s wages attached). Yet debtors often have questions about the automatic stay, including when it takes effect and how long it remains in effect. Our West Palm Beach bankruptcy attorneys can provide you with more information.
Automatic Stay Takes Effect from the Moment Your Bankruptcy Petition is Filed
The automatic stay takes immediate effect — as soon as you file your bankruptcy petition. That means creditors or debt collectors must stop actions against you to recover money you owe. This includes phone calls, texts, emails, and other forms of contact.
Injunction Remains in Effect Through the Duration of Your Bankruptcy Case
The automatic stay will remain in effect throughout your bankruptcy case, whether you are anticipating a shorter Chapter 7 bankruptcy case or a longer Chapter 13 bankruptcy. The only exception is if a creditor petitions to have the stay lifted (just for their debt) and the court agrees. This type of “lifting” or “removal” of the automatic stay for a specific creditor usually only happens with secured creditors who want to have access to collateral. The automatic stay can only be lifted on a case-by-case basis with court approval, so you will have details in advance if one of your creditors is planning to take such action.
Automatic Stay Applies to Most Debts
You should be aware that the automatic stay is likely to apply to all of your debts, but it may not apply to certain debts depending on what you owe and when you accrued the debt. If you owe family support payments, such as child support, the automatic stay will not stop you from owing these as your bankruptcy case moves forward, and your ex can continue to take steps to collect unpaid child support, for example. Additionally, if you accrue new debts after filing your bankruptcy petition, the automatic stay will not apply to these debts.
Contact Our West Palm Beach Bankruptcy Attorney for Assistance with Your Case
Do you have questions about how the automatic stay will protect you when you file for bankruptcy? Whether you have questions about the automatic stay or you have other questions or concerns about the bankruptcy process, one of the experienced West Palm Beach bankruptcy lawyers at Kelley Kaplan Delaney & Eller, PLLC can answer those questions for you today. As soon as you are ready to move forward with your bankruptcy filing, our firm can work with you to draft your bankruptcy petition and to put all necessary documentation in order so that you can begin receiving the protections of the automatic stay. Contact us for more information.
Source:
law.cornell.edu/uscode/text/11
