WHAT IS THE "AUTOMATIC STAY" IN BANKRUPTCY?

Most people decide to file for bankruptcy when they are being hounded by their creditors by receiving letters and phone calls demanding that they get current with their account. If debtors ignore their creditor, then most creditors will sue them and, when they get a judgment, then an earnings garnishment follows. That’s usually what triggers the filing of bankruptcy.

A lot of people ask, can you stop stop harassing phone calls, a lawsuit, or an earnings garnishment before you file? The answer in most cases is NO. You can’t stop creditors or an earnings garnishment until your bankruptcy case is filed and you receive a case number. Once the case is filed, then the court issues what’s called an automatic stay. That order compels creditors to stop all collection activity against a debtor. The automatic stay goes immediately into effect. All of your creditors receive notice of the stay from the bankruptcy court.

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THIS VIDEO IS INTENDED FOR EDUCATIONAL PURPOSES ONLY AND DOES NOT CREATE AN ATTORNEY/CLIENT RELATIONSHIP.

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Видео WHAT IS THE "AUTOMATIC STAY" IN BANKRUPTCY? канала Attorney Robert Flessas