A More Detailed List on What the Automatic Stay Can Prevent

Here’s some information on how the automatic stay affects some common emergencies.

Utility disconnections. An automatic stop can prevent a disconnection on utilities if you’re behind on a utility bill and the company is threatening to disconnect your water, electric, gas, or telephone service. The disconnection is prevented for at least 20 days.

Foreclosure. An automatic stay temporarily stops foreclosure proceedings. But it’s important to know that most likely the creditor will be able to proceed with the foreclosure sooner or later.

Eviction.The automatic stay may offer some help if you are being evicted, but the new bankruptcy law makes it easier for landlords to proceed. A landlord can continue just as if you hadn’t filed for bankruptcy if they already have a judgment of possession against you when you file.

An automatic stop will also not help if the landlord alleges that you’ve been endangering the property. A landlord can also ask the court to lift the stay, allowing the eviction — and the court will probably agree to do so.

Collection of overpayments of public benefits. If you receive public benefits and were overpaid, the agency is allowed to collect the overpayment out of future checks – but an automatic stay prevents this collection. But if you become ineligible for the benefits, the automatic stay will not prevent the agency from denying or terminating benefits for that ineligibility reason.

Multiple wage garnishments. Filing for bankruptcy stops garnishments. You are able to collect a full salary, and you may also be able to discharge the debt in bankruptcy. Although no more than 25% of your wages can be taken to fulfill court judgments – up to 50% for child support and alimony, many people file bankruptcy if more than one wage garnishment is being threatened.

Educate Yourself on What Cannot Be Prevented

While an Automatic Stop can prevent these issues, there are a number of things it cannot prevent. It is in your best interest to ensure you know what those things are. A lawyer can help walk you through the particulars of your situation.