Section 362 of the Bankruptcy Code contains Title 11’s important provisions regarding the automatic stay, which is the mechanism that stops, bars, or “stays” the collection activities of a bankruptcy debtor’s creditors. Compared to other sections of the Bankruptcy Code, §362 is fairly straightforward and easy to understand. Section 362(a) lists the actions that are stayed by the bankruptcy filing. The following contains a summary of the collection activities prohibited by section 362 of the Bankruptcy Code.
- The automatic stay stops lawsuits
the commencement or continuation, including the issuance or employment of process, of a judicial, administrative, or other action or proceeding against the debtor that was or could have been commenced before the commencement of the case under this title, or to recover a claim against the debtor that arose before the commencement of the case under this title;
- The automatic stay prevents the enforcement of judgments
the enforcement, against the debtor or against property of the estate, of a judgment obtained before the commencement of the case under this title;
- The automatic stay stops repossession and garnishment
any act to obtain possession of property of the estate or of property from the estate or to exercise control over property of the estate;
- The automatic stay affects the use of any lien
any act to create, perfect, or enforce any lien against property of the estate;
any act to create, perfect, or enforce against property of the debtor any lien to the extent that such lien secures a claim that arose before the commencement of the case under this title;
- The automatic stay stops collection activities
any act to collect, assess, or recover a claim against the debtor that arose before the commencement of the case under this title;
- The automatic stay prevents setoffs
the setoff of any debt owing to the debtor that arose before the commencement of the case under this title against any claim against the debtor; and
- The automatic stay stops tax proceedings
the commencement or continuation of a proceeding before the United States Tax Court concerning a tax liability of a debtor that is a corporation for a taxable period the bankruptcy court may determine or concerning the tax liability of a debtor who is an individual for a taxable period ending before the date of the order for relief under this title.
Most debt collectors assume that consumers are unaware of their rights and protections under federal law. However, Theron Morrison cares about protecting your rights. Theron Morrison has the necessary experience to ensure that all consumers receive the full benefit of the protections afforded them by federal law. Call 801.456.9933 today to schedule a FREE consultation. We have locations in Ogden, Logan, Sandy, and St. George to serve the residents of the counties of Weber, Cache, Salt Lake, Utah, Morgan, Davis, Washington, and surrounding areas.