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After a long and exhausting battle with creditors and collection agencies, it is very common for bankruptcy petitioners to breathe a sigh of relief when the automatic stay kicks in. Under Chapters 7 and 13 bankruptcies, the protection provided to petitioners through the automatic stay prohibits all creditors from continued collection efforts. While this protection may sound like a catchall, there are several prohibited collection activities specifically prohibited that petitioners may not know about. Bankruptcy petitioners should stay informed of the protection afforded to them through the automatic stay so that they may take the proper actions in the event a creditor continues harassing collection activity.

The automatic stay is designed to protect bankruptcy petitioners from the continued collection efforts of creditors. Whether a creditor is seeking a monetary judgment or the seizure and control of property, the automatic stay prohibits both activities from continuing after the bankruptcy process has been initiated. Any attempt to obtain property from the bankruptcy estate is prohibited, as well as any attempts to enforce a lien against the property. The automatic stay also prohibits the continuation of any legal proceeding against the petitioner by a creditor to recover a debt.

Individuals fearing legal action by the United States Tax Court are also given protection through the automatic stay for the duration of the bankruptcy process. All proceedings set before the United States Tax Court, whether new or a continuation must also be stopped. The automatic stay essentially protects petitioners from all types of collection activity during their bankruptcy proceedings.

For many bankruptcy petitioners, relief may be experienced long before the bankruptcy is discharged.  However, as eager for relief as individuals may be, the decision to file bankruptcy is a difficult one and may be better made with the advice of a bankruptcy attorney.