Latest News 2009 December Understanding the Term "Automatic Stay"

Understanding the Term "Automatic Stay"

By definition, a temporary stay is a temporary evaluation that takes effect as soon as an individual or corporation files for bankruptcy.

Once an automatic stay has been put into place, creditors are prohibited from taking certain actions against the debtor, such as filing a lawsuit, making harassing phone calls, initiating a foreclosure, garnishing wages, or attempting to gather debts in any way.

The purpose of an automatic stay in a Chapter 13 bankruptcy case is to give the debtor breathing room to catch up on his or her debts and get their finances reorganized. In a Chapter 7 bankruptcy case, an automatic stay gives the bankruptcy trustee time and protection to administer the debtor's assets.

Taking Advantage of an Automatic Stay

If you are struggling to pay off your debts, and you have creditors calling and harassing you on a daily or weekly basis, you should speak with an experienced bankruptcy attorney about filing for bankruptcy and applying an automatic stay. Millions of people have found automatic stays to be very liberating and extremely effective in helping to reduce the stress, anxiety, and hassle of having unpaid debts.

To get the bankruptcy process started, click here to find a bankruptcy lawyer in your area!