One of the most beneficial aspects of the bankruptcy process is called an “automatic stay.” The automatic stay is a federal order or injunction that will immediately stop collection efforts by most of your debtors. The idea behind the automatic stay is to give the debtor some temporary relief during the bankruptcy process, and it can be helpful to you for a variety of reasons.
Facts about the automatic stay
The automatic stay is a document that is sent to your creditors once you file bankruptcy. It takes effect immediately and is applicable to both Chapter 7 and Chapter 13 bankruptcies. Many people find the automatic stay to be one of the most helpful aspects of bankruptcy because it can prevent a variety of unpleasant circumstances from occurring. Below is a list of some of the things an automatic stay can help you with:
- Keeping your property. All actions by creditors against your property or assets will seize temporarily during the automatic stay.
- Foreclosures and evictions. The automatic stay can temporarily prevent your home from being foreclosed. There is also a chance it can save you from being evicted. However, this is not true in all cases.
- Keeping your automobile. If you are late on payments, creditors cannot repossess your car during the automatic stay.
- Keeping the lights on. If the utility companies are threatening to turn off your power, gas, water or telephone, an automatic stay can prevent this from happening. It’s not recommended you file bankruptcy simply to keep the power on, but knowing you will not have to worry about basic services, especially when you have children, is an added benefit of bankruptcy.
- Wage garnishing. An automatic stay will immediately suspend wage garnishing from your creditors.
- Collections. With an automatic stay in place, creditors will no longer be allowed to call and harass you about your debt.
Contact a Bronx bankruptcy attorney today to learn more about the automatic stay
If you want more information about the automatic stay and the bankruptcy process in general, you should contact the law offices of Thomas M. Denaro, Esq. We have three decades of experience helping clients recover their financial stability. We can not only help you with the bankruptcy process, but also with debt management and planning for a better financial future. If you are considering filing for Chapter 7 or Chapter 13 bankruptcy in the Bronx, contact us today at (718) 863-6000 for a free consultation or contact us online.