When a person files for personal bankruptcy using either a chapter 7 bankruptcy or Chapter 13 bankruptcy, creditors must stop calling and pursuing any course of action to collect debts. This is known as an automatic stay, and it gives people filing personal bankruptcy protection from their creditors while they are undergoing the bankruptcy process. Although the automatic stay can stop almost all collection activity, prevent foreclosure, collection calls, and repossessions, there are some exceptions.
Some common situations where creditors can fight the automatic stay include the following:
The Foreclosure Process is already or almost completed- If your home has a sale date, even a chapter 13 bankruptcy may not stop foreclosure.
Child support is not protected by an automatic stay, also alimony may not be placed into the automatic stay. Although many wage garnishment are stopped by filing bankruptcy, child support and alimony garnishment will not.
Bankruptcy court provides a lifted stay. This is not a common decision but in rare cases the Massachusetts bankruptcy court may grant a creditors request.
When thinking about personal bankruptcy, you need to hire an experienced Abington bankruptcy attorney. At the Law Offices of Brian R Lewis, we can answer your questions about automatic stay as well as discuss your legal options for bankruptcy. Contact our offices today 508-946-3323.