The Automatic Stay: Bankruptcy's Most Powerful Rule
The automatic stay is the rule that makes bankruptcy work in an emergency. Under 11 U.S.C. § 362, the instant a petition is filed — before any judge looks at it — nearly all collection activity against you must stop: garnishments, foreclosure sales, repossessions, lawsuits, levies, and phone calls.
What the stay stops
Wage garnishments end with the next payroll; scheduled foreclosure and trustee's sales are cancelled; pending lawsuits freeze; repossession agents must stand down; and creditors who keep collecting can owe damages for willful stay violations.
What the stay doesn't stop
Criminal proceedings, most child support and alimony actions, and certain tax audits continue despite the stay. Secured creditors can also ask the court to lift the stay — most commonly a mortgage lender when plan payments aren't being made.
Repeat-filer limits
If you had a bankruptcy case dismissed within the past year, the stay in a new case lasts only 30 days unless the court extends it; after two dismissals in a year, no stay arises at all without a court order. These rules make the first filing count.
Exemption amounts and rule thresholds change on statutory schedules. See our monthly rule reports for the current figures with citations to the official sources.
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Bankruptcy.AI is a technology platform, not a law firm, and does not provide legal advice. Majors Law Group, P.C. is a separate, independent law firm. This page is general information and is not legal advice; outcomes depend on your specific facts.