Monday, March 1, 2010

The Automatic Stay, Section 362

The Automatic Stay.

Section 362 of 11 U.S.C states in relevant part that the commencement of a case under Section 301, 302 or 303 of this title operates as a stay as to all entities. There are eight specific subsections; we will focus on three of them here.


First, creditor's cannot, start, continue or maintain any lawsuit filed against you for collection of a debt, this means garnishments too, must stop.


A creditor must stop all enforcement against property of the debtor such as garnishment, foreclosure, or repossession.


A creditor must not attempt to enforce on your property like repossess or foreclose after the case is already filed.


These are the most common of the eight subsections and seem to be the most relevant to most debtors who need to file either chapter 7 or chapter 13.

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