Joliet bankruptcy attorney David Siegel states that the automatic stay is created immediately upon the filing of your bankruptcy case whether it be a Chapter 7 or a Chapter 13 case. The automatic stay is a one-page document that gets sent to creditors notifying them of your bankruptcy and prohibiting them from taking certain actions. If you are being garnished, if your bank account is ready to be seized, if you are subject to a lawsuit or a foreclosure Sheriff’s sale date, then the automatic stay is what you need to acquire immediately to stop those collection efforts.
Your attorney will be able to prepare an automatic stay which can then be sent to creditors via e-mail, fax and regular mail. Once the creditor receives the automatic stay, if they do anything in violation of that automatic stay, then net creditor can be held in contempt and sanctioned by the federal Bankruptcy Court.
The automatic stay is the most important thing and the desired result that someone wants immediately upon filing a bankruptcy. The automatic stay basically says to the creditors a case has been filed, you have to stop collecting and you have to let the bankruptcy court administer the case whether it’s a Chapter 7 fresh start or a Chapter 13 bill consolidation through the court. The automatic stay still goes in place.
Creditors do have the ability in certain circumstances to bring a motion to modify the automatic stay and remove that bankruptcy protection. We see this very often in a Chapter 13 bankruptcy case when the debtor is not making the proper payments to either the trustee or to the mortgage company. In those cases, the mortgage company’s attorney will file a motion to modify the automatic stay which will remove the bankruptcy protection and allow the creditor to proceed against the collateral in any other non-bankruptcy remedies such as state court remedies.
Hire an experienced bankruptcy attorney so that when your case is filed and automatic stay is created and proof of the automatic stay is sent to the creditors to get them to stop collecting. The automatic stay is exactly what you are looking for as a debtor when you file either a Chapter 7 or a Chapter 13 bankruptcy case.