Automatic Stay Protection

When filing a chapter 7 bankruptcy, you get bankruptcy protection with an automatic stay. An automatic stay keeps creditors from all collection activities, including garnishing your wages and filing lawsuits. However, the automatic stay only lasts for so long. If your case is closed, dismissed or denied a discharged, your bankruptcy protection will end and creditors can take action against you. But, if your bankruptcy is discharged, the stay is permanent for everything listed on your bankruptcy. Any new debt you incur after filing your bankruptcy is not covered by the automatic stay and will remain due and owing.

If you have had a prior bankruptcy case dismissed within one year of filing your current case, the automatic stay will initially only remains in effect for 30 days. However, you can petition the court to extend the automatic stay permanently.

Creditors can lift the automatic stay, meaning they can take action against you while you’re in a bankruptcy. For the creditor to be able to do that, they have to file a motion with the court. So, if you fall behind in your payments for a house or a car, they can foreclose or repossess your property. But, most or all of your debt listed on your bankruptcy that is still protected by the stay will get discharged.