One of bankruptcy law’s most useful tools is the automatic stay. With an automatic stay the bankruptcy court prohibits creditors from continuing any activities related to collections, which can give some much needed time to get your finances in order. If a creditor does wish to continue collecting a debt during the automatic stay period, they must obtain the permission of the court first and take part in a hearing on the matter. The automatic stay can also be used to halt lawsuits, and stop foreclosures and repossessions. Therefore, an emergency bankruptcy is a bankruptcy filing that arises from needing to file quickly in order to evoke the automatic stay and protect your assets. The emergency bankruptcy process is similar to a regular bankruptcy filing with a few key differences.
When you file an emergency bankruptcy, you are allowed the ability to file several forms to start the bankruptcy process and obtain an automatic stay against your creditors. You are then given 14 days to fill out the rest of the paperwork necessary for the courts to consider your bankruptcy. The primary two forms you need to fill out for emergency paperwork are a voluntary petition and a mailing matrix. In some courts, you may also be required to proactively fill out a dismissal of Chapter 7 order in the event you don’t complete the remainder of the paperwork within the allotted two weeks.
Emergency bankruptcies, as you can see, can be extremely useful when dealing with time sensitive debt situations where your property, and/or assets are at risk. You will want to consult with a Sacramento bankruptcy attorney about the forms the court needs for an emergency filing in your district, and of course it is crucial to complete the remaining forms within the allotted time frame lest your bankruptcy cased be dismissed.