Millions of Americans continue to labor under the pressure of mounting debt while struggling to find employment in a job market that continues to be sluggish. Many people feel the stress and pressure of sinking deeper into debt and feel trapped. The tactics employed by creditors to enforce a debt can become increasingly oppressive including wage garnishments, liens on your home or other real property and levies against your bank account just to name a few. Many people feel cornered like there is no way out; they may be afraid even to answer the phone because it rings incessantly with nasty collections calls from rude insulting creditors. Some people are even afraid to leave their home or answer the door because they are afraid of being accosted by a process server attempting to serve them with a lawsuit from a creditor. Far too many people believe that there is no escape from the stress and anxiety. However, the emergency stay and the protection of bankruptcy can provide much needed relief.
The emergency stay is an important form of relief for debtors because it brings an immediate cessation to virtually all debt collection efforts. The automatic stay imposes an injunction against collection efforts by creditors against a debtor. With narrow exceptions, the filing of a Chapter 7 or Chapter 13 bankruptcy means that the automatic stay takes immediate effect. The stay means that creditors must generally terminate debt enforcement efforts which includes suspension of the following debt collection actions:
- Lawsuits and enforcement of judgements
- Repossession actions
- Wage assignments
- Foreclosure actions
- Bank Levies
- Harassing phone calls and letters
The automatic stay effectively brings all of a person’s debts and assets within the jurisdiction of the bankruptcy court. The purpose of the automatic stay is to provide a debtor seeking bankruptcy relief a chance to “catch one’s breath” as the debtor seeks to obtain relief in bankruptcy. The stay also protects creditors from having a particular creditor take action that would result in that creditor effectively prejudicing the rights of other creditors. The automatic stay is a very important protection offered to debtors as part of the relief obtained in bankruptcy. Sometimes if there are urgent litigation issues such as a pending foreclosure sale of one’s residence, an experienced Southern California bankruptcy attorney can use an emergency filing to quickly trigger the automatic stay to protect debtor from losing their home in a foreclosure sale. While the creditor can file a motion for relief from the automatic stay, the debtor with the assistance of an experienced Southern California bankruptcy attorney may be able to work out a payment plan through a Chapter 13 and keep their home.
The duration of the protection from the automatic stay depends on one’s filing history. If a person has filed a bankruptcy within the last year that was dismissed, the automatic stay only last 30 days. If someone has had multiple bankruptcies dismissed, then the debtor may not receive the protection of an automatic stay.
At Southern California Law Advocates, P.C., our attorneys represent those facing unmanageable debt throughout Southern California. We offer a free case assessment so that we can evaluate your situation and provide a candid assessment of your rights and options so call us today at 1-866-337-7220.