One essential component of knowing how to stop foreclosure is knowing about the automatic stay. If you are filing for bankruptcy or considering filing, here’s what you need to know about how this important provision works:
What is an Automatic Stay?
This provision in United States bankruptcy law allows for a temporary hold on creditors pursuing debts. This can include collection agencies, individuals, and government entities. The automatic stay goes into effect the moment a debtor files for bankruptcy under the United States Bankruptcy Code Section 362. This provision applies to both individuals and businesses. However, an automatic stay does not protect non-debtor entities like corporate affiliates, co-defendants, guarantors, or corporate officers.
What Actions Does the Automatic Stay Protect Against?
These provisions protect against a variety of actions performed by creditors against debtors such as:
- Starting or continuing court proceedings in order to collect on a debt
- Repossessing a debtor’s collateral
- Creating, perfecting, or enforcing liens against a debtor’s property
- Foreclosing on a debtor’s home
Debtors can also sue creditors who contact them or attempt to sue them after the automatic stay has been put in place. Keep in mind, however, that not all debts qualify for the automatic stay. These include:
- Child support
- Loans from pensions
- Tax debt from the IRS
This one provision provides a variety of benefits that allows debtors to either restructure debt, come up with a repayment plan, or get the debt discharged depending on the situation. The bankruptcy law experts at Galler Law have a 99% six success rate in discharging debt from Chapter 7 Bankruptcy filings.
Want to know more about how to stop foreclosure on your home? The team at Galler Law is ready to help. For more information about our services, you can contact our team with a variety of virtual services to keep you safe during the COVID-19 pandemic. Start your consultation today by calling (770) 671-8830 or emailing email@example.com.