Make It Stop! – The Power of the Automatic Stay

by John Skiba
Contact

When you fall behind on your bills you feel helpless. Like it is you against the world. The first thing that happens is the phone calls. The phone rings off the hook night and day. After a while you stop answering because you realize there is no purpose. The collector is there to get you to pay money and could care less about the reasons that got you into this position.

Next, you face lawsuits, repossessions, and even foreclosure. After filing hundreds of bankruptcies for clients I understand that bankruptcy is not always the best option, but bankruptcy has tools that can greatly improve your situation and dramatically reduce your stress. One of the most powerful tools provided by the Bankruptcy Code is the Automatic Stay.

Automatic Stay

One of the great benefits of a bankruptcy over other approaches is the Automatic Stay. Immediately upon the filing of your bankruptcy case the court issues an order that stops all collection efforts against you and your property. This means that creditors will not be allowed to call you on the phone, send you letters, sue you, garnish your wages, repossess your property, or even foreclose on your home.

Once your case is filed the bankruptcy court will mail out notices to your creditors to let them know of your bankruptcy filing and that they are not to continue to try and collect money from you. It generally takes 2 to 3 business days for your creditors to get notice. However, the Automatic Stay goes into effect immediately upon filing, not when your creditor gets notice. This means that if you have a foreclosure sale set for noon and it is 10:00 a.m., the filing of your bankruptcy case will stop the foreclosure sale. This is true of wage garnishment as well.

How Long Does The Automatic Stay Last?

The Automatic Stay is a shield that protects you from your creditors; however it does not last forever.

• Discharge: The Automatic Stay terminates once your case is discharged. The bankruptcy discharge is the order issued by the court at the end of your case that eliminates your debts. Once your case is over, so is the Automatic Stay.

• Dismissal: If your case is dismissed for any reason the Automatic Stay terminates upon dismissal.

• Motion to Lift Automatic Stay: Sometimes a creditor will ask the bankruptcy court to lift or remove the Automatic Stay so that they can repossess or foreclose on the collateral that is securing their loan. Typically this only happens if you are not making the monthly payment. For instance, if you are not making your house payment after your case is filed, the mortgage lender will likely go to the bankruptcy court and ask them to remove or lift the Automatic Stay so that they can foreclose on the house.

• Multiple Bankruptcy Cases: If you file more than one bankruptcy in a year there are special rules that will limit the length or time period that they Automatic Stay will be in place.

The Automatic Stay is designed to give you some breathing room from your creditors while you deal with your debts through the bankruptcy process. I offer a free bankruptcy consultation where we can discuss your specific situation and help you determine if bankruptcy is a good option for you.

Arizona bankruptcy attorney John Skiba can be reached at (480) 420-4028 or via email at john@skibalaw.com.

LOADING PDF: If there are any problems, click here to download the file.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© John Skiba, Arizona Consumer Law Group, PLC | Attorney Advertising

Written by:

John Skiba
Contact
more
less

Arizona Consumer Law Group, PLC on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Privacy Policy (Updated: October 8, 2015):
hide

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.

Security

JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.