Whether you seek protection under Chapter 7 or Chapter 13, the automatic stay goes into effect immediately upon the filing of your petition. In addition to stopping all calls and letters, creditors may not take legal action against you—for example, by filing a lawsuit—except by going through the bankruptcy proceeding. You don’t need to file any additional documentation for the stay to go into effect—it’s automatic.
It’s important, though, that you honor all your obligations in the bankruptcy proceeding and that you don’t engage in any actions that could be construed as bankruptcy fraud. If you do, your creditors can ask the bankruptcy court to terminate the automatic stay.
The automatic stay essentially operates as a court order. Any legal action taken to collect a debt after the stay goes into effect is null and void, having no legal effect. Furthermore, a creditor who repossesses property after the stay is in place must return the property and immediately stop all attempts to collect payment or recover collateral.
At the office of Howard N. Sobel, we work closely with people in New Jersey in personal bankruptcy filings. Contact our office online or call us at 856-424-6400 to set up a free initial consultation (on selected cases). We are currently available by phone, text message, or videoconference only. Evening and weekend appointments can be arranged upon request. We accept all major credit cards.
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