What happens after an automatic stay violation?

What happens after an automatic stay violation?

| Nov 5, 2018 | Automatic Stay |

If you have filed for bankruptcy in the state of Maryland or if you are considering filing for bankruptcy, it is likely that you will be interested in how the automatic stay works. The automatic stay in bankruptcy filings is something that many debtors are drawn to, since they want an end to the stresses of constant creditor communication.

If you are struggling with debts and you want to end debt collection attempts from creditors, filing for bankruptcy may be something to consider. However, you should not file for bankruptcy only for this reason. A bankruptcy filing is a big commitment that takes a great deal of determination before a fresh financial start can be enjoyed.

Understanding the automatic stay

The bankruptcy code is in place to protect debtors, and offers specific provisions to enable this protection. One of the provisions is the automatic stay.

Simply put, the automatic stay means that all creditors must stop their debt collection activities when it comes to the debtor in question. They cannot attempt to collect a debt, take actions due to the unpaid debt or attempt to evict the debtor. The automatic stay is put in place after a debtor files for bankruptcy.

What happens if the automatic stay provision is violated?

If the provision is violated, it could have been violated accidentally or deliberately. For example, the creditor may not yet have received information about the bankruptcy filing. In order to be able to take legal action against the creditor, you must be able to show that the automatic stay violation was intentional.

If you can show that the violation was intentional, you can go about taking action to reclaim the damages. You will likely be compensated for any indirect damages that resulted from the violation.

If you have filed for bankruptcy and you have reason to believe that one of your creditors intentionally violated the automatic stay, it is important that you take action. You should first confirm that the automatic stay was in place at the time. Also, make sure that the creditor in question had received notice of the bankruptcy filing.

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