Los Angeles Bankruptcy Law in Woodland Hills CA

Automatic Stays

The filing of  a bankruptcy automatically stays most actions against the debtor or the debtor's property, such as foreclosures, lawsuits, or garnishments.  Simply put, the stay stops these types of actions from going  forward against the creditor.  The stay, which is designed to preserve the debtor's property and to give the debtor a break from litigation, is neither absolute nor permanent.

A creditor who is seeking relief from the stay and who wants to go forward against the debtor or his property must show the bankruptcy judge that there is cause for granting relief (which may include showing that the creditor's interest in particular property is not adequately protected).  The creditor may also show  that the debtor has no equity in the property and that the property is not needed for a reorganization.

Most often, it is the secured creditor who wants relief from a stay to foreclose on real estate or to repossess a car.  Creditors can frequently get relief from the stay to foreclose on property if the debtor has no equity in the property or if the property is uninsured. Where the equity cushion (that is, the difference between the creditor's claim and the value of the property) is small, the debtor may have to make "adequate protection payments" to the creditor to preserve the equity cushion for the creditor's benefit as a condition of the stay remaining in effect.

Contact the Bankruptcy Law Firm in Los Angeles at 866-912-2669 for a free consultation or use our contact form. At the Law Offices of Michael H. Raichelson, our fees are flexible, and under certain circumstances you can make payments over time.

The Law Offices of Michael H. Raichelson is a debt relief agency as defined by the United States Bankruptcy Code.