When you file bankruptcy, an automatic stay in bankruptcy is imposed. That means that all matters in which you are being sued for money/collections are stopped/stayed.
- This is like a “pause” button on your debts.
Also, when you file bankruptcy:
- most (if not all) of your debts will be wiped out.
- creditors cannot collect or attempt to collect upon any debts while you are in bankruptcy.
- foreclosure/sheriff’s sale is also paused/stopped. Your lender must stop foreclosure processes immediately.
It is important to have a Board Certified Bankruptcy attorney handle your case.
Here is an example of a Debtor who decided to represent herself (pro se). She paid the price by not receiving protection/stay that she sought.
- Pro Se Debtor filed for Chapter 13.
- Filed a second Chapter 13 case pro se.
- Debtor did not make a motion to have the 30-day stay extended and it expired.
- Debtor attended Meeting of Creditors.
- Debtor found out that the 30 day stay* had expired. (*which is basically a force field around you so creditors cannot touch your assets)
- Debtor asked the Court to extend the automatic stay
Bankruptcy Protection – Denied
- Court denied Debtor’s request to extend the automatic stay.
- Debtor appealed.
- Appellate Court denied appeal – the Debtor’s only excuse was that she was mistaken.
- Bankruptcy code states she had only 30 days from the bankruptcy petition date to (1) file a motion to continue the automatic stay and (2) have the motion heard. 30 days means 30 days – no more.
As I always point out, Bankruptcy is a specialized field and pro se Debtors who handle their cases on their own are detriments to their goals. Clients who have filed for a bankruptcy on their own or with an attorney who does not specialize in bankruptcy frequently ask me to take over the case.
Most of the time, more work is required to take over a case than it is to start a new case.
Experienced and specialized representation is required before debtors go to Bankruptcy Court. I am a Board Certified Bankruptcy Lawyer and I protect debtor’s assets.
All aspects of your case should be explained to you by your Bankruptcy Lawyer. You need to know: What is an automatic Stay when you file bankruptcy?
Your Lawyer will know what procedures and deadlines are required for your automatic stay in bankruptcy to be in force.