When a debtor files a petition for bankruptcy, an automatic stay of all collection activities against the debtor takes immediate effect. This is a broad, temporary protection for the debtor against legal action to collect the debtor's money or property to satisfy debts.
How bankruptcy's automatic stay impacts debtors and creditors
One of the most important features of federal bankruptcy law is the automatic stay. When a consumer or business files a petition for bankruptcy relief in U.S. Bankruptcy Court, the petition effectively freezes most collection efforts against the debtor who filed the bankruptcy petition.
