How does filing under Chapter 13 affect collection proceedings and foreclosures previously filed against the debtor?

The filing of a Chapter 13 case automatically stays (stops) all lawsuits, attachments, garnishments, foreclosures, harassment on the telephone and other actions by creditors against the debtor or the debtor’s property. A few days after the case is filed, the court will mail a notice to all creditors advising them of the automatic stay. Certain creditors may be notified sooner, if necessary. Most creditors are prohibited from proceeding against the debtor during the entire course of the Chapter 13 case. If the debtor is later granted a Chapter 13 discharge, the creditors will then be prohibited from collecting the discharged debts from the debtor after the case is closed.

A debtor who has previously filed a Chapter 13 case has an automatic stay for only 30 days after commencement of the case unless the court extends the automatic stay upon request  of the debtor for good cause. A debtor who has had two prior bankruptcy cases pending within a year will not have the automatic stay unless the debtor successfully obtains a grant of automatic stay from the bankruptcy court for good cause.

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