Sacramento Bankruptcy Attorney Talks About Automatic Stays
Sacramento Bankruptcy Attorney Talks About Automatic Stays
When a debtor files a petition for bankruptcy, many things happen right away. First of all, the Bankruptcy Court will assign the debtor an official case number and schedule a date for a meeting of creditors. (This is often called a 341 Creditor meetings) Secondly, the Bankruptcy court places an Automatic Stay on all creditors which forbids any creditors from trying to collect on the debts without the court permission.
The Automatic Stay is a very powerful right given to the debtors. For instance, the Automatic Stay will stop any foreclosure sales that are about to come up. They will stop any repossession of vehicles. They will stop any wage garnishments or levies on bank accounts. The Automatic Stay should also stop any lawsuits that are pending. The Automatic Stays even forbids creditors from calling to ask for payment.
The Automatic Stay is necessary because when a debtor files for bankruptcy, the debtor surrenders all ownership of their assets to the Bankruptcy Court. The government will now decide what to do with the property. Since the government is now in control of the fate of the debtor’s assets, the creditors cannot touch it without permission. Since the government owns the property, the creditors may not even call the debtor to ask for repayment. If a creditor does call or move against the debtor’s assets, then the creditor faces possible sanctions which may have them paying the debtors.
Then, as the Bankruptcy progresses, the government will slowly release assets back to the debtor or the creditor as the law dictates. If you are facing a foreclosure, repossession, wage garnishment, or bank levy, please call Sagaria Law at 1-800-941-6730 for a consultation to see if Bankruptcy’s Automatic Stay can help you. Please visit www.sagarialaw.com for more information.
