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AUTOMATIC STAY IN BANKRUPTCY
What is the duration of automatic stay?
Automatic will remain as long as the judge wishes. It will remain until and unless a debtor gets a discharge. Automatic stay prevents the debtor from foreclosure. As soon as the arrears are discharged, the lenders have the right to proceed. And in case of Chapter 13, the automatic stay remains during the total period.
If automatic stay is violated
If the automatic stay is violated then court send notice to the creditors. But court took few weeks for this and in that time, if any creditor files any case against any debtor then the filing is considered as an invalid one.
Benefits of automatic stay
Foreclosure – Automatic stay can stop foreclosure of the debtors property thus helps the debtor to retain their property. However, once the automatic stay is lifted, the creditors are ready to proceed.
Eviction – In this case, automatic stay can also help a debtor to some extent. But according to the new federal law, if any case of eviction is already going, then the automatic stay could not help that debtor.
Wage garnishment – Wage garnishment can also be prevented through wage garnishment. As per rule, only one forth of the salaries is permissible to use for court judgment.
AUTOMATIC STAY IN BANKRUPTCY
Automatic stay is a legal document produced by the court, which is used to stop the debt collectors and collection agencies from taking away the property of the debt defaulters. Once a person files for bankruptcy, the automatic stay comes into play. In certain situations, automatic stay helps the debtors to protect their property. If a debtor files for Chapter 13 then the co debtors, also get the benefit of automatic stay.
Automatic stay has many advantages. It helps the stops the creditors form certain actions. They are:
Automatic stay has many advantages. It helps the stops the creditors form certain actions. They are:
- Automatic stay stops the collection agencies from making collection calls to the debtors.
- They prevent the creditors to repossess the valuable property of the debtor.
- Automatic stays also prevent the "foreclosure sale".
- It even stops the creditors from filing lawsuit against any debtor.
What is the duration of automatic stay?
Automatic will remain as long as the judge wishes. It will remain until and unless a debtor gets a discharge. Automatic stay prevents the debtor from foreclosure. As soon as the arrears are discharged, the lenders have the right to proceed. And in case of Chapter 13, the automatic stay remains during the total period.
If automatic stay is violated
If the automatic stay is violated then court send notice to the creditors. But court took few weeks for this and in that time, if any creditor files any case against any debtor then the filing is considered as an invalid one.
Benefits of automatic stay
Foreclosure – Automatic stay can stop foreclosure of the debtors property thus helps the debtor to retain their property. However, once the automatic stay is lifted, the creditors are ready to proceed.
Eviction – In this case, automatic stay can also help a debtor to some extent. But according to the new federal law, if any case of eviction is already going, then the automatic stay could not help that debtor.
Wage garnishment – Wage garnishment can also be prevented through wage garnishment. As per rule, only one forth of the salaries is permissible to use for court judgment.
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