What is an Automatic Stay and How Does It Affect Me?

When you file for Chapter 7 or Chapter 13 bankruptcy in Kentucky, the automatic stay immediately goes into effect. The automatic stay prohibits most creditors from continuing with collection activities, which can provide some relief to debtors.

Once the automatic stay goes into effect, it can protect a debtor from the following…

• Utility Disconnections – If you’re behind on a utility bill and the company is threatening to disconnect your water, electric, gas, or telephone service, the automatic stay will prevent the disconnection for a period of time.
• Foreclosure – If your home mortgage is being foreclosed on, the automatic stay temporarily stops the proceedings, but the creditor will often be able to proceed with the foreclosure eventually. If you are facing foreclosure, Chapter 13 bankruptcy is usually a better remedy than Chapter 7 bankruptcy, if you wish to keep your house. A Northern Kentucky bankruptcy attorney can help you determine this.
• Eviction – If you are being evicted from your home, the automatic stay may provide some help; however, there may be a few wrinkles. If you are facing eviction, it is in your best interests to speak to an experienced bankruptcy attorney.
• Collection of Overpayments of Public Benefits – If you receive public benefits and were overpaid, normally the agency is entitled to collect the overpayment out of your future checks. The automatic stay prevents this collection.
• Multiple Wage Garnishments = Filing for bankruptcy stops garnishments dead in their tracks. Although no more than 25% of your wages may be taken to satisfy court judgments (up to 50% for child support and alimony), many people file for bankruptcy if more than one wage garnishment is threatened because garnishments can be detrimental to an employee’s paycheck.

Lawrence & Associates Accident and Injury Lawyers, LLC’ Bankruptcy attorneys are dedicated to helping Northern Kentucky families get the help they need. We serve all of Boone, Kenton, Campbell, Gallatin, Owen and Pendleton County, as well as other counties in the surrounding areas. Come see us at our Fort Mitchell, Kentucky office today.

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