This article is about the automatic stay in bankruptcy. This is one of the things that an individual or a company filing bankruptcy really wants, and this is the part of the law that says that on the filing of a bankruptcy petition, all collection activity has to stop. All creditors have to stop what they’re doing to collect debts. They can’t call for money, they cannot send statements or demands, they can’t sue, and in most cases, they can’t file liens.
The automatic stay is automatic. It happens as soon as a petition is filed. If you ignore the automatic stay and take some of those actions, you’re interfering with the bankruptcy process and you may be held accountable. You could be held in contempt of court and could be made to pay damages for violating the automatic stay. You may be thinking, if I don’t know about the filing, how can I be bound by the automatic stay?
The answer is you are bound by ut but in order to be punished for violating it, you have to have notice of it. But there are other ways like you could be having lunch with friends in your industry and they talk about the fact that the debtor filed bankruptcy. That gives you notice of the bankruptcy that binds you to the automatic stay. If you’re noticing any way you’re bound by the automatic stay and can be punished for violating that automatic stay and interfering with the bankruptcy.
How can you get notice of a bankruptcy?
The easiest way is the data tells you that she filed bankruptcy. You could also get a notice in the mail from the bankruptcy court of the bankruptcy.
The filing of a bankruptcy in Utah offers an individual immediate protection from virtually all creditor collection efforts. These activities usually include:
- The commencement or continuation of an action against the debtor for a claim that arose before the filing of the bankruptcy;
- The enforcement of a judgment obtained before the filing of the bankruptcy;
- Any act to obtain possession of property of the bankruptcy estate;
- Any act to create, perfect, or enforce any lien against property of the estate;
- Any act to create, perfect, or enforce a lien against property of the debtor to the extent that such lien secures a claim that arose before the filing of the bankruptcy;
- Any act to collect, assess, or recover a claim against a debtor that arose before the filing of the bankruptcy;
- The setoff of any debt owing to the debtor that arose before the filing of the bankruptcy;
The automatic stay under 11 U.S.C 362 provides an immediate and fundamental benefit to an individual in that it gives the individual relief from creditors. It stops all collection efforts, harassment, and foreclosure actions. The automatic stay allows an individual to reorganize and/or to be relieved of their obligations.
In summary, when a debtor files for bankruptcy, an automatic stay immediately goes into effect.
The automatic stay prohibits creditors from continuing with collection activities while the debtor rehabilitates it’s business and negotiates a payback plan with its creditors aside from a few exceptions. If you ignore the automatic stay and take action, you could be held in contempt of court and be made to pay damages. Even if a creditor does not know about the automatic stay, they are still bound by it, but they likely won’t be punished for a violation, whether it’s an official notice or a conversation with a colleague.
There are many ways that you can be given notice of a bankruptcy. You should stop all collection activity immediately or be at risk of a stay violation. Get out of bankruptcy with attorney Ryan E. Simpson.
To get immediate relief from your creditors, contact us by Phone at (801) 432-8682.
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Reviews for Ascent Law LLC Salt Lake City, Utah
We've gotten divorce and child custody work from Ascent Law since the beginning because of my ex. We love this divorce firm! Staff is gentle, friendly and skilled. Tanya knows her stuff. Nicole is good and Ryan is fun. Really, all the staff here are careful, kind and flexible. They always answer all my questions, explain what they're doing and provide great legal services. I personally think they are the best for divorce in Utah.
I have had an excellent experience with Ascent Law, Michael Reed is an absolutely incredible attorney. He is 100% honest and straight forward through the entire legal process of things, he also has a wonderful approach to helping better understand certain agreements, rights, and legal standing of matters, to where it was easy to know whats going on the entire process. I appreciate the competency, genuine effort put forth, and assistance I received from Ascent and attorney Michael Reed, and I will be calling these guys if ever I have the need again for their legal assistance! 5star review Wonderful attorneys!
This review is well deserved for Ryan and Josh. New clients should know they are worth the 5 star rating we give them. We needed 2 sessions from them because of the complexity of the matter, but they are both very passionate about his helping others in need. My sister needed bankruptcy and I needed divorce. Sometimes they go hand in hand but a large shout out to this team - also Nicole is one of the sweetest people you ever did meet - she offered me warm cookies!
Mike Anderson and his colleagues & staff are knowledgeable, attentive and caring. In a difficult and complex case that eventually went to trial, Mike was the voice of reason and the confidence I needed. His courtroom abilities are amazing and I felt his defense of me was incredible. His quick thinking and expertise allowed for a positive result when I felt the World was crumbling. His compassion, after the case, has helped me return to a good life. I trust Mike and his staff. They are friendly and very good at what they do.
I worked with Attorney Alex and Paralegal Ami in my divorce case. I got to know the team very well over the course of two years. I cannot think of a better team to have worked with. Ami and Alex are not only exceptional law professions who are very knowledgeable and thorough, they are also the best human beings who empathize with the emotions I was experiencing. Alex was conscious of my budget and worked efficiently to try to reduce unnecessary legal expenses. My case also involved some dealings with a foreign country that Alex and his team had previously dealt with. They did an amazing job addressing cultural barriers in a very respectful manner and did not fall short in quality of work or in standards when dealing with some of these new challenges. Ami deserves a medal for being extremely professional, calming, and compassionate when it is needed most. When you need family law attorneys, call this firm. I now feel I can move forward with grace and dignity.