How do I file for bankruptcy?
Question & AnswerHow do I file for bankruptcy?
2. Stay of proceedings
When you file for , there is an automatic “stay of proceedings”. This means that your unsecured creditors cannot sue you, take your money, or ask for payment. An is a that does not have for their debt.
Secured creditors are not covered by a stay of proceedings. A is a creditor that holds collateral for your debt. Common examples of secured are:
- mortgage: the house is the collateral
- car loan: the car is the collateral
With a , if you do not pay what you owe or if you stop making regular payments, the creditor can take the collateral instead.