What is the bankruptcy automatic stay?

The bankruptcy automatic stay is a legal protection provided to individuals or businesses who file for bankruptcy in North Carolina. The automatic stay prevents creditors from taking any kind of action to collect on a debt while the bankruptcy case is open. This includes stopping any legal action, such as wage garnishment and foreclosure, as well as any collection activities, such as phone calls and letters. The bankruptcy automatic stay is a powerful tool that can help provide relief from financial difficulty. It can stop creditors from making demands and harassing debtors, as well as temporarily halting repossession, garnishment, and foreclosure proceedings. Additionally, the automatic stay can help protect co-signers from liability for the debtor’s debt. The automatic stay does not, however, provide a permanent solution. The stay is only in place while the bankruptcy case is open. Once the bankruptcy case is closed, the stay will be lifted, and creditors can begin making demands and taking actions to collect the debt. Additionally, there are some situations where creditors may be able to obtain permission from the court to take action against the debtor even while the automatic stay is in place.

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What is the bankruptcy automatic stay?

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