ABC’s of Bankruptcy A is for Automatic Stay

Over the next few weeks, I’ll be posting some useful bankruptcy information.  I’ll call it the ABC’s of Bankruptcy.   Some will be fun, some will be instructional, but all will be informative.

Lets get to it.
A is for Automatic Stay.

This falls under Section 362 of the bankruptcy code.  It’s what gives bankruptcy it’s teeth against creditors.   The Automatic stay prevents creditors from taking action against bankruptcy debtors.   It stops the phone calls, it stops the collection letters, it stops the lawsuits.  It stops the garnishments from a debtor’s paycheck.  The automatic stay can help get utilities back on for debtors, it can stop repossession of a car, and even get it back in a chapter 13.  The automatic stay is what stops the foreclosure process too.   Therefore, this is arguably the most important tool in your bankruptcy lawyers arsenal.  It kicks in the instant the bankruptcy case is filed.  Creditors don’t have to get notice either, hence the word “AUTOMATIC.”

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Terrance Leeders

Chicago Bankruptcy Lawyer, husband, father, Cubs fan.

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