An automatic stay will go into effect as soon as an individual files bankruptcy. This will prevent all lenders and collection agencies from engaging in any collection activities, including repossessions, wage garnishments, lawsuits, bank restraints, debt collection, phone calls from debt collectors or lenders, and foreclosure actions. Read on to learn more about an automatic stay in New York.
How Can an Automatic Stay Benefit Me?
When it comes to an automatic stay, there are a number of important benefits. Some of these benefits include:
- An automatic stay will immediately go into place after filing for bankruptcy.
- All collection activities will be stopped by an automatic stay.
- The automatic stay will stop debt collection. It will stop lenders and collection agencies from engaging in collection activities.
- Once bankruptcy is filed, the automatic stay will stop the individual from being harassed by collection agencies. Some agencies have a reputation to harass the debtor with phone calls and threats.
- Most importantly, the automatic stay will give the debtor enough room to breathe and regroup. This is priceless and will allow the debtor to develop a strategy to recover financial stability.
How Does an Automatic Stay Work?
An automatic stay can be implemented as soon as a voluntary bankruptcy case is filed. The automatic stay then remains in effect until it is lifted by Bankruptcy Court order, or by the closure of the case.
While an automatic stay can be beneficial in a number of different ways, there are some exceptions, including:
- The exercise of the police power of the state
- Domestic relation actions to establish child support, alimony, and paternity
What Type of Bankruptcy Should I File For?
There are various types of bankruptcy, each with its own merits. The most common types of bankruptcy are Chapter 7 and Chapter 13. The type of bankruptcy for which you should file will depend on your individual situation. For this reason, it is important to speak with an experienced attorney. A bankruptcy attorney can help walk you through the process every step of the way and help you get back on your feet.
Reach out to our firm today to learn more about the automatic stay program and your bankruptcy options in New York.
CONTACT A BANKRUPTCY LAWYER TO DISCUSS YOUR DEBT OR COLLECTION ISSUE
Michael D. Pinsky, P.C. represents clients in bankruptcy actions and related matters. Please call 845-394-2616 or contact the firm online to schedule a consultation.