For those facing difficult financial situations in Central New York, Chapter 7 bankruptcy can be a lifeline for managing debt and finding a way out of the situation. If you have taken advantage of this bankruptcy option, it is essential that you understand the process of Chapter 7 bankruptcy and what an automatic stay in Chapter 7 bankruptcy means.
At Grady PK, PLLC, our primary goal is to provide our Central New York clients with clear and compassionate guidance as they navigate bankruptcy. We will work with you directly to find the best bankruptcy option for your situation as well as assist you in navigating the steps of the bankruptcy plan you choose. In this article, we will discuss what an automatic stay in bankruptcy means, what an automatic stay in Chapter 7 entails, and whether or not this can be lifted. For further assistance with your bankruptcy case, call our office today to speak with a compassionate bankruptcy attorney in Central New York.
What Does Automatic Stay Mean in Chapter 7?
If you have filed for Chapter 7 bankruptcy, you need to understand what bankruptcy and automatic stays mean as well as automatic stay foreclosure. An automatic stay is an injunction that will immediately stop most of your creditors from pursuing collections when you have filed a bankruptcy petition. While you are under the protection of an automatic stay, your creditors will not be able to make calls, send letters, garnish wages, or file lawsuits against you.
Chapter 7 bankruptcy allows you to use your non-exempt assets to repay your creditors and help you get out of debt. A Chapter 7 automatic stay gives you time to distribute your assets fairly among your creditors so that your assets aren’t prematurely seized.
The purpose of an automatic stay for Chapter 7 bankruptcy is that it gives you the time and the peace to make decisions that you will be happy with later on. You won’t have to worry about being harassed by your creditors or being forced into making rushed decisions regarding your assets. This also protects you from more extreme measures creditors may take, such as repossessions, wage garnishment, and evictions.
How Long Does an Automatic Stay Last?
Something to keep in mind when going through this process is that an automatic stay is only temporary. It will generally stay in place until the discharge is entered, so an automatic stay will typically last 3 to 4 months. However, keep in mind that this is dependent on each situation.
If you have prior bankruptcy cases, this will have an impact on how long the automatic stay is in place. For example, if you have filed a bankruptcy case within the last year, the automatic stay for your current Chapter 7 bankruptcy case will only last for 30 days. If you need a longer period of time, you will have to file a Motion to Extend the Automatic Stay within the allotted 30 days.
Additionally, if you have filed two or more bankruptcy cases within the last year you will no longer have the option of an automatic stay unless the court directly grants a Motion to Impose the Automatic Stay in your case.
Can an Automatic Stay be Lifted?
Although an automatic stay is very useful for Central New York residents filing Chapter 7 bankruptcy, creditors can still file a motion for relief from automatic stay in Chapter 7 cases. Secured creditors are more likely to do this such as mortgage or car loan lenders since they have collateral.
A common example of when a motion for relief may be filed is if you are behind on your mortgage payment and your mortgage lender wants to start foreclosure proceedings. Creditors are much less likely to file a motion for relief if you are up-to-date on all of your payments.
It’s important to understand that you need to respond to any motions for relief within 14 days of receiving it, otherwise the court will grant the motion by default. You will receive a copy of this motion, which you and your bankruptcy attorney can go over and formulate a response. The court will provide a hearing date regarding the motion to allow you and your creditor to provide evidence.
What Happens After Automatic Stay is Lifted?
If the court decides to lift the automatic stay either by default or after siding with the creditor, you will need to know what comes next. The creditor will be allowed to move forward when it comes to repossessing property or foreclosing. Even though they now have the ability to do this, they will still need to follow state law regarding evictions and collection proceedings.
It is a good idea to contact the creditor directly so that you can come to an agreement to either surrender assets or move out of the property. Your bankruptcy attorney can handle communication on your behalf so that you can focus on other important aspects of your bankruptcy plan.
Central New York’s Top Compassionate Bankruptcy Attorney
Although the process of Chapter 7 bankruptcy can feel confusing, it is really straightforward once it is broken down and provides many features to better protect you from creditors. At Grady BK, PLLC, we can help you understand the details of your Chapter 7 bankruptcy plan so that you can proceed with confidence and peace of mind. When you have a local Central New York bankruptcy attorney on your side, you will be provided with the most up-to-date bankruptcy information as well as personalized advice regarding your bankruptcy plan and financial situation.
At Grady BK, PLLC, we understand how stressful bankruptcies can be for Central New York residents, which is why we prioritize a compassionate and personalized approach. We will guide you through the Chapter 7 automatic stay process, ensuring you are better protected and the bankruptcy process goes smoothly.
Contact us today at 315-299-9005 discuss your situation with a bankruptcy attorney. Our team at Grady BK, PLLC is ready to provide you with the assistance you need whether you are ready to file for Chapter 7 bankruptcy or you need help with an automatic stay.
