When you file for bankruptcy, an automatic stay goes into immediate effect. This means that creditors are no longer able to contact you in an attempt to seek payment from you using any means. This brings immediate relief from harassment and any high-handed tactics used by creditors to get money from you. What many people don't realize is that there are certain circumstances where automatic stay is not possible because of exclusions. Here are some of them:
1. Child support
Automatic stay does not apply to your obligation to give child support. This is also the case with any other court-ordered payment such as spousal support.
2. Divorce proceedings
If you are in the midst of divorce proceedings, you cannot get out of it as automatic stay does not apply here. The only situation where automatic stay comes into play in divorce proceedings is when there is an issue over property in the divorce. In this case, your spouse (or soon-to-be ex-spouse) is not allowed to approach you over the property once you file for bankruptcy.
If you are indicted of a crime or are charged with committing it, then an automatic stay will not prevent you from undergoing the legal process of going to court, answering your charges, defending yourself etc.
4. Landlord actions
If an eviction notice has been served on you before you filed for bankruptcy, an automatic stay cannot be used to stop eviction proceedings. However, there may be a chance your bankruptcy attorney may help prevent you from getting evicted if your landlord has not filed the necessary papers.
5. Retirement Plan Loans
If you have taken a loan on any retirement plan such as a 401, you are still obligated to repay the loan. This means any deductions on your paycheck to repay the loan will continue and automatic stay does not cancel them.
If you have questions about whether you will be affected by automatic stay exemptions you can contact me for a free 30 minute bankruptcy consultation.