The automatic stay in bankruptcy is a court-ordered injunction that goes into effect the minute a case is filed. The automatic stay prohibits creditors from continuing with collection efforts after a debtor seeks the protection of the bankruptcy court. For example, collection calls, garnishments, lawsuits, foreclosure, letters, e-mails and all other contact with the debtor must come to an end. Creditors who ignore the automatic stay and continue to contact the debtor after they have filed for bankruptcy can be subject to sanctions by the court. In some cases, such as when a debtor enters bankruptcy behind on their mortgage, creditors can ask the court to lift the automatic stay in order to proceed with foreclosure.
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