The automatic stay is a useful way to protect your income, assets, and properties. There are some things it can and cannot. For those in Texas, the automatic stay can be a life saver benefit after filing bankruptcy. This blog guide will define the automatic stay, explain how it can help, note what it cannot do, and also how to get legal help if you’re unsure of how it works.
What is the automatic stay?
An automatic stay is a court order which stops any collections against you from creditors, collection agencies, and sometimes government offices. The main advantage here is that you can delay your home being taken, if not stop it completely, but you can also stop wage garnishments and power turns offs.
What can it do?
We noted how it can delay a foreclosure. Sometimes if you file a Chapter 13 bankruptcy before the foreclosure is started, you have the opportunity to save your home from being taken. This only occurs if you can stop the collection before it begins. In some instances creditors can stop you from getting this, which is decided by the courts. You can also stop utility disconnections, an eviction, and wage garnishments. While your utility bill may be small, if you intend to stay in the residence for some time, keeping your electric on can be quite important (especially during winter). In terms of wage garnishments, many file bankruptcy to protect themselves against wages being taken, and this can ensure you get your full salary every month.
What can’t it do?
Usually, an automatic stay via bankruptcy cannot deny the government taxes. You can still be audited, still be forced to pay your taxes, but the IRS cannot take property or income while the automatic stay is in effect. If you pay child support or alimony, you are required to continue these payments; filing bankruptcy makes no difference. If you broke the law in some way, you can still be charged with any crimes and face court. If you have a pension, quite often this can be used as part of your bankruptcy finalling. Finally, if you filed unsuccessfully before, you’ll have to prove that this filing is correct, lest you lose the automatic stay.
Who can help?
It should be noted again that creditors you owe money do have legal options when it comes to the automatic stay. If you are facing Texas foreclosure, and get it stopped, this is one example where a creditor can ask for the stay to be lifted. There are many other situations where the stay can be lifted, making it important to know the laws and how to work them. This is where an experienced Texas bankruptcy attorney can help. He or she should have experience in Chapter 7 and Chapter 13 bankruptcy, be able to educate you on the laws, help protect assets and income, and make this process easier for you.
