In Oregon, falling behind on payments because of an illness or income loss is often the first step in a downward spiral that leads to overwhelming debt. If you decide you need a fresh financial start, Chapter 7 bankruptcy may be a viable solution for you because of the protection it provides from creditors through the automatic stay. This is a court order that prevents creditors from attempting to collect debts or property that have been included in your bankruptcy.
According to Cornell University Law School’s Legal Information Institute, the automatic stay does not always stop creditors from making attempts to collect on your debt, and there are exceptions that allow these actions to proceed. For example, if you have filed for bankruptcy within the past year and had that case dismissed, it may affect the conditions of the stay. You may be able to reinstate or extend it, but the creditor may be able to get the court’s permission to continue to pursue collections, as well.
The automatic stay cannot protect you from being evicted from your home or having it foreclosed if the proceedings for one of these actions was begun before the filing of the bankruptcy. It could delay the process by a few days, which may be helpful if you are trying to find a new place to live. The stay also does not allow you to stop paying child support, and tax liens are typically not included in the order, either. This information about automatic stays is for educational purposes only, and is not intended to be taken as legal advice.