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Glossary

Automatic Stay

The automatic stay is a statutory injunction that arises when a bankruptcy petition is filed, halting most collection actions against the debtor and property of the estate (11 U.S.C. § 362(a)). For an individual under chapter 7, 11 or 13, it may terminate with respect to the debtor on the 30th day if one prior case was pending within the preceding year and dismissed (§ 362(c)(3)); if two or more were dismissed, no stay takes effect (§ 362(c)(4)). A party in interest may move to extend or impose it.

Key points

  • The stay arises by statute on the filing of a petition; nobody applies for it and no judge signs it (11 U.S.C. § 362(a)).
  • It reaches most lawsuits, judgment enforcement, garnishments, levies, lien enforcement and collection efforts against the debtor and property of the estate.
  • Two things let collection continue: the exceptions listed in 11 U.S.C. § 362(b), and a creditor's motion for relief from the stay under § 362(d).
  • Repeat filings can shorten or eliminate it, and 11 U.S.C. § 362(c)(3) and (c)(4) set conditions and provide motions to extend or impose.
  • It pauses collection; it does not discharge a debt and it does not void a lien.

If you have just seen this term on a court notice or in a letter from a creditor, it describes something that already happened automatically when a bankruptcy case was filed. Here is what the stay covers, how long it generally lasts, and where it stops.

What does "automatic stay" mean?

The automatic stay is the pause on collection that federal law imposes the instant a bankruptcy petition is filed. Nobody applies for it and no judge signs it: 11 U.S.C. § 362(a) says the petition itself "operates as a stay," applicable to all entities. What it reaches is broad. It stays the commencement or continuation of most lawsuits and administrative proceedings against the debtor, enforcement of a prepetition judgment, acts to obtain or control property of the estate, acts to create, perfect or enforce a lien, acts to collect a prepetition claim, and the setoff of most prepetition debts. In everyday terms, that generally covers collection calls, a pending collection suit, a wage garnishment, a bank levy and a foreclosure sale. It is not permanent and it is not universal: subsection (b) carves out a list of exceptions, and creditors can ask the court for relief from it.

Why does it matter in a bankruptcy case?

The stay is what makes an orderly case possible. Without it, whichever creditor moved fastest would take the most, and the debtor would spend the case fighting on several fronts at once. Two consequences matter most to someone who has just filed. First, enforcement already under way, such as a garnishment, a bank levy or a scheduled foreclosure sale, generally has to stop while the stay is in effect. Second, disputes move to the bankruptcy court: a creditor who wants to start or continue a lawsuit in another forum generally has to ask for relief from the stay first (11 U.S.C. § 362(d)). The stay is also temporary by design. It generally continues until the case is dismissed or closed and, in an individual case, until the court grants or denies the discharge (11 U.S.C. § 362(c); Bankr. M.D. Fla. Procedure Manual — Motion to Extend Automatic Stay).

How does the stay work in practice?

Nothing has to be filed to start the stay; it begins with the petition, and creditors learn of it from the notice the court sends. A creditor who wants to proceed anyway files a motion for relief from the stay under 11 U.S.C. § 362(d), asking the court to terminate, annul, modify or condition it. Common grounds include a lack of adequate protection of the creditor's interest in collateral, which 11 U.S.C. § 361 says may be met by cash payments, a replacement lien, or other relief giving the creditor the indubitable equivalent of its interest. Timing matters: under 11 U.S.C. § 362(e), thirty days after such a request the stay is terminated as to the party who made it unless the court, after notice and a hearing, orders the stay continued. Forms, deadlines and hearing practice are set by local rules and vary from district to district.

What do people get wrong about it?

Three misunderstandings come up repeatedly. The first is treating the stay as a discharge. It suspends collection while it lasts; it does not cancel a debt, and it does not void a lien, so a mortgage or car loan remains enforceable against the collateral. The second is assuming it covers everything. 11 U.S.C. § 362(b) lists exceptions, including a criminal action against the debtor and certain domestic-relations proceedings, such as establishing paternity, establishing or modifying a domestic support obligation, and child custody or visitation. The third is assuming a co-signer is covered. A separate codebtor stay reaches consumer debts of the debtor owed by an individual who is also liable, with its own exceptions and its own route to relief (11 U.S.C. § 1301 for chapter 13 and 11 U.S.C. § 1201 for chapter 12). It is not part of a chapter 7 case.

Frequently asked questions

Does the stay work differently if I have filed before?
It can. For an individual under chapter 7, 11 or 13 whose earlier case was pending within the preceding year and was dismissed, the stay may terminate with respect to the debtor on the 30th day, subject to a statutory exception for a case refiled under a chapter other than chapter 7 after certain dismissals. A party in interest may move to extend it, and the hearing must be completed before that 30-day period expires (11 U.S.C. § 362(c)(3)).
What if two or more of my prior cases were dismissed in the past year?
Where two or more single or joint cases of that individual debtor were pending within the previous year and were dismissed, no stay goes into effect on the filing of the new case (11 U.S.C. § 362(c)(4)). A party in interest, including the debtor, may request that the court impose the stay, and that request must be made within 30 days of the filing (Bankr. M.D. Fla. Procedure Manual — Motion to Impose - Reimpose Automatic Stay).
What happens to the stay if the case is dismissed?
Dismissal ends the case, and with it the stay that arose from filing it. Dismissal also generally revests property of the estate in whoever held it immediately before the case and reinstates certain liens and transfers that had been avoided (11 U.S.C. § 349). Collection can resume unless something else halts it, and a later case may run into the repeat-filing limits above.

Sources

By Antonio G. Jimenez, Esq. · Florida Bar No. 21022

Sources verified July 29, 2026 · How we verify

Every figure on this page is drawn from a primary legal source and checked against our canonical legal database before publication. Bankruptcy.law is not a law firm and does not provide legal advice.

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