| Secured Creditors and Relief From The Automatic | | | | discharged. At that point, you likely be free from any |
| Stay | | | | future obligation toward the creditor. |
| In certain circumstances, a secured creditor can | | | | The Bankruptcy Estate |
| move the court for modification of the automatic | | | | What is the bankruptcy estate? The bankruptcy |
| stay so that they may pursue recovery of their | | | | estate is all of your property as of the date of the |
| collateral. For example, an auto finance company can | | | | bankruptcy filing, wherever located and by |
| petition to the court to modify the automatic stay if | | | | whomever held. Every possible interest (contingent, |
| you are not making current payments toward the | | | | partial, legal or equitable) goes into the bankruptcy |
| creditor, if you are not up to date with the creditor | | | | estate. Although there are exemptions which allow |
| or if you are not properly insuring the vehicle against | | | | you to keep all or a portion of your property, the |
| loss. In those cases, the creditor will be granted its | | | | property is still technically considered property of the |
| relief and will be permitted to recover the collateral | | | | estate. |
| despite the bankruptcy filing. In a Chapter 7 | | | | The concept of the estate applies to property |
| bankruptcy case, you will lose the right to possess | | | | owned at the time of filing. Most of what you acquire |
| and own the vehicle; however, you will not be | | | | after the date of filing will remain your property. |
| responsible for any outstanding debt related to the | | | | However, there are a few exceptions to this general |
| vehicle. This could be a tremendous relief for you by | | | | rule. |
| eliminating a huge vehicle loan obligation. | | | | If you inherit money or property within six months |
| As it relates to real estate mortgage companies, the | | | | after your case is filed, that money or property will |
| same situation as above applies. The lender will | | | | become property of the estate to the extent that it |
| petition the court for relief if you are not making | | | | cannot be exempted. |
| timely payments, if you are not current with the loan, | | | | If you receive a marital property settlement that |
| if you are not paying the real estate taxes on the | | | | arises from a pre-bankruptcy divorce or separation, |
| property or are otherwise creating a hazard or risk | | | | then that property becomes property of the estate |
| to the lender. Thus, in a Chapter 7 bankruptcy case, | | | | to the extent that the property cannot be |
| the automatic stay will only provide temporary relief | | | | exempted. |
| to you as it relates to secured creditors. As far as | | | | Tax refunds that are received after the date of filing |
| general creditors and unsecured creditors, the | | | | become property of the estate to the extent that |
| automatic stay may continue until the case is | | | | they cannot be exempted. |