What is an automatic stay under Chapter 13 Bankruptcy?

An automatic stay is a legal protection offered by Chapter 13 Bankruptcy in Washington. It is a court order that requires all of the debtor’s creditors to cease collection activities against the debtor. The automatic stay is put into effect immediately after the filing of the Chapter 13 Bankruptcy petition. The primary purpose of the automatic stay is to prevent creditors from taking any action against the debtor without first gaining permission from the court. This includes the right to garnish wages, foreclose on the debtor’s property, or contact the debtor regarding the debt. The stay also prevents creditors from filing lawsuits against the debtor, or continuing any lawsuits they have already filed. In some cases, the stay may be lifted or modified if the creditor can demonstrate to the court that they would suffer financial harm due to the stay. For example, a creditor may be able to show that they are entitled to certain payments that the debtor agreed to in a contract, and that the automatic stay would prevent them from receiving those payments. Overall, the automatic stay is a powerful legal tool that protects debtors in Chapter 13 Bankruptcy proceedings in Washington. It serves to give the debtor a chance to fulfill the terms of their Chapter 13 repayment plan without the distraction or stress of creditor harassment.

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What is an automatic stay under Chapter 13 Bankruptcy?

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