What is the Automatic Stay of Bankruptcy and How Does it Help Me?
Filing for bankruptcy – any kind of bankruptcy whatsoever- immediately triggers an injunction against the continuance of any action by any creditor against you or your property; this is called the automatic stay, and it is a critical element of your bankruptcy case. If you file for Chapter 13 bankruptcy, that injunction extends to anyone else who is obligated to repay your debts- co-signers and co-debtors.
The automatic stay gives you protection from your creditors during the bankruptcy case. In order for a creditor to continue to take action against you, that creditor must obtain court approval first.
There are, however, limits on how long the automatic stay lasts. For example:
- If you had a prior bankruptcy case pending in the last year which was dismissed then the automatic stay lasts for only the first
thirty (30) days after your case is filed unless you or your lawyer gets a court order extending the automatic stay;
- If you had two or more prior bankruptcy cases pending in the last year which was dismissed then the automatic stay does not take
effect at all unless you or your lawyer gets a court order allowing the automatic stay.
- The automatic stay does not apply at all to child support determinations (determining IF you owe child support or if so, how
- The automatic stay has no effect on criminal matters at all. Most criminal courts will allow you to pay fines or restitution through your Bankruptcy, but they are not required to do so.
Remember that even debts that are not Discharged from Bankruptcy are prevented from taking actions to collect on the debt while your Bankruptcy is open, so it can be very powerful.
It is also important to remember that the Automatic Stay only applies to debts that you incurred before the date your Bankruptcy was filed. Debts that come after are not affected.
KCLS LIMITS THE GEOGRAPHY IN WHICH WE TAKE CASES.
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Krumbein Consumer Legal Services, Inc.
5310 Markel Rd.
Richmond, VA 23230