When someone is facing the possibility of bankruptcy, the thought of losing his or her home is a very real and frightening one. However, the protections of the bankruptcy automatic stay can help the filer protect his or her home through a Chapter 7 or Chapter 13 filing. The key to this protection rests heavily on the type of bankruptcy filing and the filer’s financial situation. The bankruptcy automatic stay also offers filers who are facing a multitude of collection calls relief from their creditors, protect them from lawsuits, wage garnishment, repossession, and losing valuable property.
As soon as the bankruptcy petition is filed, the automatic stay goes into effect. After this point, creditors and debt collectors are legally barred from attempting to collect on any debt owed by the filer.