automatic stay

automatic stay
automatic stay
the suspension of actions, such as debt collection or foreclosure, against the company in bankruptcy. This occurs automatically when a bankruptcy petition is filed. This action protects the debtor from creditors seeking to seize its assets. It protects some creditors in that it prevents one creditor from obtaining an excessive share of the assets of the bankrupt company to the exclusion of the other creditors (Glossary of Common Bankruptcy Terms)

Under section 362 of the code, the filing of a bankruptcy petition automatically stops most collection and enforcement actions by creditors. Certain criminal matters and matters arising after the filing are not stayed. The stay may not apply to an eviction on a pre-petition judgment for possession or on a case filed within a year after dismissal of a prior case. Creditors may be liable for damages if they violate the automatic stay.
It is the automatic stay that stops a sheriff's sale of the debtor's property after a bankruptcy petition is filed. (Bernstein's Dictionary of Bankruptcy Terminology)

An injunction that automatically stops lawsuits, foreclosure, garnishments, and all collection activity against the debtor the moment a bankruptcy petition is filed. (BankruptcyAction.com)

An injunction that automatically issues against all of the debtor's creditors upon the filing of a bankruptcy petition thereby stopping all lawsuits, foreclosures, garnishments, and collection activities against the debtor and the debtor's property (SA-Bankruptcy.com)

The injunction issued automatically upon the filing of a bankruptcy case which prohibits collection actions against the debtor, the debtor's property or the property of the estate. (Bankruptcy in Brief)

United Glossary of Bankruptcy Terms 2012.

automatic stay
Under section 362 of the code, the filing of a bankruptcy petition automatically stops most collection and enforcement actions by creditors. Certain criminal matters and matters arising after the filing are not stayed. The stay may not apply to an eviction on a pre-petition judgment for possession or on a case filed within a year after dismissal of a prior case. Creditors may be liable for damages if they violate the automatic stay. It is the automatic stay that stops a sheriff's sale of the debtor's property after a bankruptcy petition is filed.

US Bankruptcy 2012.


Glossary of Bankruptcy.

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