Is There Any Defense Left After a Motion of Stay Has Been Granted?

This personal bankruptcy question was posted on the internet in 2011 in a bankruptcy discussion: “If a motion for relief of stay has been granted in a bankruptcy case is there any defense?”

The moment you file a bankruptcy, a judge will order all collecting actions to cease, an important feature called the automatic stay. The automatic stay, applicable to all types of bankruptcy filings, means that the mere request for bankruptcy protection automatically stops and brings to a cessation certain lawsuits, foreclosures, utility shut-offs, evictions, repossessions, garnishments, attachments, and debt collection harassment.

The automatic stay has historically been one of the most powerful tools a bankruptcy filer has in his or her arsenal for protecting themselves against any further actions by creditors. The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 basically changed how courts viewed the automatic stay. Bankruptcy courts can now look back over a period of time to take a closer look at any abuse the filer may have committed in the handling of their assets before they filed for bankruptcy protection.

Creditors can now petition the bankruptcy court to question asset abuse possibilities a filer may have committed in handling assets that could have been used to pay creditors. If a creditor is successful in their petition, they can potentially get the bankruptcy court judge to lift the automatic stay so they can sue the filer for collections on their debt. A filer not responding to the petition made by a creditor is asking for trouble, because it is much harder for a filer to get a bankruptcy judge to reverse his decision to lift the stay once it has been lifted.

Unless there is extenuating circumstances that prevented you from defending against the petition in the first place, there is not really any defense for having the stay reinstated for that particular creditor if he is successful in getting the judge to relieve the stay.

If you cannot get the stay reinstated, your only recourse is to try and negotiate with the successful creditor, a feat now made potentially more difficult. The automatic stay of bankruptcy is one of the main reasons you file for protection. Giving up on the stay without a fight can possibly be financially catastrophic to your particular situation.

That is why most of you might need a bankruptcy lawyer when you file for bankruptcy. A lawyer can help protect your rights during the bankruptcy process by defending against petitions presented to the court that may change the outcome of the process. They also can help you understand how bankruptcy laws might apply to your particular situation.

If you determine you are in need of relief from the stress associated with debt and you live in or around the metropolitan areas of Greenville, Spartanburg, or Anderson, South Carolina, contact us here today at .We will help you find a bankruptcy attorney in your area that will help you with any questions you may have on bankruptcy law.

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