When you are filing for
bankruptcy, the court generally orders an automatic stay which stops collection efforts
from creditors. This order also puts a stop to any lawsuit filed against
you at the time. If you are at risk of foreclosure or eviction, the automatic
stay could halt the process and give you time to come up with a new financial
plan. Filing for bankruptcy can be beneficial for many people but it may
not always be the best solution to a financial hardship so be sure to
contact an experienced Houston bankruptcy lawyer before making this decision.
If you do choose to pursue bankruptcy the automatic stay is able to prevent
many penalties and lawsuits you could be facing, including:
- Foreclosure: The automatic stay will put a temporary halt on the foreclosure process.
- Eviction: There are new bankruptcy laws that make it easier for landlords
to continue the eviction process but the automatic stay order may buy
you some time.
- Utility Disconnections: Utility companies oftentimes threaten to disconnect
your services and the automatic stay can help prolong the action for at
least 20 days.
- Wage Garnishments: If your wages are currently being garnished, filing
for bankruptcy can bring that to an end.
The automatic stay order is a protection benefit for petitioners filing
for bankruptcy, but it is important to be aware of how exactly it helps
you. Many people think that the automatic stay is able to stop criminal
or tax proceedings but this injunction does not do that. Automatic stay
orders do not put a halt to lawsuit actions regarding alimony or child
support either. It is necessary to note that there are ways for creditors
to get around an automatic stay order if they persuade the bankruptcy
court that it is not serving the intended purpose. If you have questions
regarding bankruptcy or how the automatic stay could protect you, feel free to
contact a Houston bankruptcy attorney from Maida Law Firm, P.C. today!