Automatic Stay

The moment you file for bankruptcy, something called the automatic stay kicks in — instantly, no separate court order needed. It stops almost everything creditors can throw at you: lawsuits, wage garnishment, bank levies, repossession, foreclosure, most collection calls and letters. If a creditor keeps coming after you once they know about the stay, they can be held in contempt of court and made to pay you damages for it.

It’s not a total shield, though. It doesn’t touch criminal cases, most child support or alimony collection, or certain tax matters. And a secured creditor — your mortgage lender or car lender — can still ask the court for permission to move forward with repossession or foreclosure if you’re not keeping current on that specific loan. If you’ve had a bankruptcy case dismissed in the last year, you might only get a shortened 30-day version of this protection instead of the full thing.

If you’re staring down a garnishment date, a repossession, or a foreclosure sale, this is often the whole reason to file before that date instead of after — once something’s already happened, the stay can’t undo it. Timing here genuinely matters.

See Filing for Bankruptcy for the full process the automatic stay kicks off, or Bankruptcy and an Active Wage Garnishment if a garnishment is already running against your paycheck and you want the specifics on what stops immediately versus what doesn’t.

Frequently asked

Does the automatic stay stop everything?

No — it doesn't touch criminal cases, most child support or alimony collection, or certain tax matters, and a secured creditor like a mortgage or car lender can still ask the court for permission to move forward if you're behind on that specific loan.

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— US Debt Compass Editorial Team

What happens if a creditor keeps collecting after the stay takes effect?

They can be held in contempt of court and made to pay you damages for violating it — the stay is legally enforceable, not just a formality.

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— US Debt Compass Editorial Team