In summary, filing the bankruptcy petition under any chapter of the bankruptcy code creates an automatic stay (unless you previously filed within the past year – talk with an attorney).

In other words, creditors cannot take any collection actions against you, such as repossessing a car, starting or continuing a law suit, foreclosing a home, garnishments or even collection phone calls.  The stay remains in effect until the judge lifts the stay,  the property is no longer part of the bankruptcy estate, or the debt is discharged.

An automatic stay WILL NOT STOP Criminal matters or restitution, child support, alimony, litigation for child support, alimony, and tax audits, however collection of taxes are stayed, at least temporarily.

Talking with an attorney, paying an attorney, or thinking about bankruptcy and telling the creditor your ‘bankruptcy thoughts’ DOES NOT create an automatic stay.  YOU HAVE TO FILE THE PETITION WITH THE BANKRUPTCY COURT.

For some reason, and it may be the internet, friend misinformation, or dare I say – attorney advertising, I keep seeing clients that believe once they meet with an attorney that they are protected by the ‘stay’.   Or, I get requests to send out a ‘stay’.  Geez – I wish I had that kind of power.

However, if you are experiencing harassing creditor phone calls and letters, I can normally put a stop to those calls and letters using the Fair Debt Collection Practices Act (FDCPA), its not near as powerful as a bankruptcy stay, but its better than hearing “can you make a payment today” for the millionth time.