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What is a Motion for Relief in a Chapter 13 Bankruptcy?

By Ullian Associates of The Law Firm of Ullian & Associates, P.C. on April 28, 2015

When you file a Chapter 13 bankruptcy an automatic stay goes into effect immediately upon the filing of your case. The Automatic Stay prevents creditors from taking any further action against you without authorization from the Bankruptcy Court, including repossessing your car or foreclosing on your house. In most Chapter 13 Plans, the Debtor is required to make payments to their secured creditors outside the Plan. When these payments are not made, a secured creditor can file a Motion for Relief seeking relief from the Automatic Stay so they can take action against the collateral (i.e. your house or car). In some cases, this is not a problem, for example when a Debtor is choosing to let a property go to foreclosure. Other times, a creditor files a Motion for Relief because the debtor has failed to make payments on a property the debtor was intending to keep.

When a creditor files this motion it is important to contact your attorney right away, because the time to respond to the Motion for Relief is not long. Oftentimes your attorney can try to negotiate an agreement with the creditor giving you a short period of time to rectify the arrears on your payments. If the creditor is granted relief from the Stay, it can begin the foreclosure or repossession process.

For more information on bankruptcy or to schedule your free consultation with The Law Firm of Ullian & Associates, P.C., contact us here.

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