Can a Creditor Lift the Automatic Stay During a Bankruptcy Case?

 Posted on April 23, 2021 in Bankruptcy

For many people, one of the fairly attractive parts of filing for bankruptcy is the automatic stay that takes place when they file a bankruptcy petition. This automatic stay will require creditors to cease all collection activity while the bankruptcy case is ongoing. This means that you, as a creditor, can no longer contact the debtor in any way or have another agency or individual contact them on your behalf for purposes of collecting debt. The discharge of debt through bankruptcy typically results in some sort of financial loss, which can put stress on any business. If your debtor has filed for bankruptcy, there are certain cases in which you can file for a motion to lift the automatic stay with the bankruptcy court, which would allow you to continue collection practices.

What You Should Include in Your Motion

To lift the automatic stay during a bankruptcy case, you must file a motion to do so. This motion must contain certain information for the court to consider before it will make its decision. Before you file your motion to lift the stay, you should be sure it includes:

• A clear and concise statement that sets forth all of the alleged facts that are grounds for relief specific to the case.

• An explanation of the grounds for the relief from the automatic stay if the grounds listed are those other than “lack of adequate protection.”

• Information about the valuation of the property, if the valuation of such property is an issue. This information can include the names and contact information of witnesses who may be present during the hearing, an appraisal of the property and names, and contact information and qualifications of expert witnesses who may be present at the hearing.

• Information about the security device, if the relief from stay is meant to allow foreclosure on a security device affecting the property of the estate.

Our Chicago, IL Debt Collection Attorney Can Help You Lift an Automatic Stay

When a debtor files for bankruptcy, you are at the mercy of the bankruptcy court to recoup your debt. If the bankruptcy court does not grant the motion to lift the automatic stay, you cannot continue debt collection efforts. At Dimand Walinski Law Offices, P.C., our team of attorneys can help you make a strong case to lift the automatic stay and ensure that you can collect the debts owed to you. Our Chicago debt collection lawyers are here to ensure you have taken all of the necessary steps to file for relief from an automatic stay. To begin discussing your case with an attorney, call our office today at 312-704-0771 to set up a consultation.

Sources:

http://www.bankruptcymortgageproject.org/dmdocuments/relief_automatic_stay_(w_d_la).pdf

https://www.law.cornell.edu/rules/frbp/rule_4001