The Automatic Stay is an Order from the Federal Bankruptcy Court requiring that all debt collection actions against a person or business that has filed for bankruptcy protection be suspended or terminated as of the date of filing. The court ordered stay is entered automatically in all bankruptcy cases unless some limited statutory exceptions apply. The automatic stay is a type of injunction or formal command by the court that prohibits any act intended to collect a debt or recover a claim against the debtor that arose before the bankruptcy case was filed.
Having a car repossessed can be a traumatic experience for anyone. Feeling powerless in this situation is understandable. However, there may be no need to despair! Most Chapter 13 debtors can get their car back once they file for bankruptcy. When a Chapter 13 bankruptcy petition is filed, an estate is created of the debtor’s property. The estate may be comprised of property that is subject to a creditor’s interest. A Chapter 13 filing grants debtors an overriding interest in estate property that trumps even a creditor’s interest in the property.