Reinstate the Automatic Stay

Can you reinstate the automatic stay?  No, but you can get the same protection through injunctive relief.  Some background will help make this clearer.

The automatic stay goes into effect when a bankruptcy is filed, and it prevents all actions to collect on a pre-petition debt.  There are only a few exceptions to the automatic stay, for example it doesn’t stop a criminal prosecution.  For the average client, the automatic stay puts a full stop to all creditor harassment.

If you have filed bankruptcy in the last year, then you will lose the automatic stay after 30 days if your bankruptcy attorney doesn’t take steps to keep the automatic stay in place.  If you have filed multiple bankruptcies in the last year, then the automatic stay may not go into effect at all.  However all is not lost.

First, you may not need the automatic stay reinstated.  If you are in a chapter 13, then your creditors will be bound to the plan; and, the plan will prevent your creditors from harassing you.  If you are in a chapter 7, the discharge will enter roughly 90 days after you file, and the discharge injunction will stop creditors from harassing you.  In these cases, you probably do not need to worry about having the automatic stay reinstated.

Second, even though the court cannot reinstate the automatic stay, the bankruptcy judge can give you the same kind of relief that you would get from reinstating the automatic stay.  This is because the bankruptcy court has the authority to enter an injunction that is the functional equivalent of the automatic stay.  The only difference is that an injunction has to be targeted at a specific creditor or creditors and cannot simply be a blanket injunction.  This isn’t a problem, because most of my clients have a whole bunch of creditors; but only one or two that are actively harassing them.

If you have had a bankruptcy dismissed without a discharge and need to file again, you need to make sure that you and your bankruptcy attorney work out a plan for dealing with the automatic stay.  If you need to get the automatic stay, make sure that you attorney understands that they have the ability to seek a specific injunction against a creditor.  A specific injunction is not the same thing as reinstating the automatic stay, but it has the same protective function.

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