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Restrictions On The Automatic Stay Under The New Bankruptcy Laws

Restrictions On The Automatic Stay Under The New Bankruptcy Laws
"""According to the new bankruptcy regulations, the automatic stay is now defined differently in various situations. However, before we examine those specific instances, it is essential that you comprehend the meaning and applications of this legal injunction.

The Automatic Stay Function And Its Applications

If you owe a creditor certain debts and fail to repay them in a timely manner, the creditor may attempt to pursue you for repayment. Generally, collection call agencies are quite competent in this regard. Generally, creditors want their money returned at any cost. When they discover that you've ceased making payments, they hire these collection agencies. The collection agencies will harass you via telephone and correspondence. However, registering for bankruptcy immediately halts all collection actions against you, resulting in an automatic stay of proceedings. Creditors are legally prohibited from stopping the foreclosure process once the application has been submitted. In addition, this legal stay prevents lenders from proceeding with pending litigation against you. Additionally, they are legally compelled to cease garnishing your wages. According to the new bankruptcy laws, the measure of protection varies based on the specifics of each case. Permit me to provide a concise overview of the same.

Statement Of Intent

Within 30 days of filing a case involving a secured debt, the court requires you to submit a statement of intent. In this statement, you must describe how you intend to address such debts. If you fail to submit this statement to the bankruptcy court within thirty days, the automatic stay will be lifted with respect to secured creditors only. Nevertheless, under the new bankruptcy laws, the trustee is permitted to petition the courts to extend the automatic stay if they deem it appropriate.

Second Application

If this is your second chapter 7 or 13 filing within a year, the court will not consider your second endeavor to be in good faith. It will provide you with a limited automatic stay, typically not exceeding 30 days. However, under the new bankruptcy laws, the court may reconsider extending the stay if you provide evidence that your petition is genuine within this time frame.

Third Application

However, if you file your petition for the third or fourth time, the court will not grant you an automatic stay. The frequent submission of bankruptcy cases appears suspicious at first glance. Therefore, if you are filing for chapter 7 or chapter 13 bankruptcy for the third or fourth time in a succession, you will need to demonstrate to the court that your reasons are genuine and in good faith.

According to the new bankruptcy laws, such proceedings are typically time-consuming because you must convince the court of the validity of your repeated filings, and you may not be able to experience the best benefits of the automatic stay.""

" - https://www.affordablecebu.com/

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"Restrictions On The Automatic Stay Under The New Bankruptcy Laws" was written by Mary under the Finance / Wealth category. It has been read 168 times and generated 0 comments. The article was created on and updated on 02 June 2023.
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