What is a Motion for Relief When Filing Chapter 13 Bankruptcy in Georgia?

When a debtor files for Chapter 13 bankruptcy an automatic stay immediately goes into effect, preventing creditors from taking further action against, so long as you repay your debt. However, when payments are not made, the creditor can then file a Motion for Relief from the Automatic Stay, allowing them to take action against you.

 

What Is an Automatic Stay?

If you file a Chapter 13 bankruptcy petition, an automatic stay goes into effect, which prevents creditors from taking further action against you to collect the funds, unless authorized by the court. The secured creditor is only allowed to move forward if no payments are received from the debtor.

The automatic stay gives the debtor some time to submit a plan and pay their creditors; however it can be lifted to allow a creditor to resume collections outside of the bankruptcy case. A loss of an automatic stay can occur when a creditor files a Motion for Relief from the automatic stay with the bankruptcy court.

 

How Can I Prevent a Lift of the Automatic Stay?

Stay Current on Chapter 13 Payments

The simplest way to avoid a loss of automatic stay is to keep Chapter 13 plan payments current. When you fall behind on payments, a creditor has the right to contact the bankruptcy court and request a Motion for Relief.

Keep Mortgage Payments Current

Another way to avoid loss of automatic stay is to keep monthly mortgage payments current. If a debtor owes a mortgage on their home when filing for Chapter 13 and does not pay after filing, the mortgage creditor has the right to file a Motion for Relief.

Keep Insurance Coverage on Your Home and Vehicles

The last way to prevent a loss of automatic stay is to keep your home and vehicles insured. If money is owed on either property, a debtor must maintain insurance on the property in the event it’s damaged. If it’s not maintained, a creditor may file a Motion for Relief to take back the property.

 

Contact a Bankruptcy Attorney Today

If you’re considering filing for bankruptcy and want to speak to an experienced attorney about what’s best for you, contact an attorney at CMC Law today. We will work with you to decide how to move forward.

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