The Automatic Stay in Nevada Bankruptcy — How It Works

The automatic stay is one of the most powerful protections in bankruptcy law. The moment a bankruptcy petition is filed, a federal court order immediately halts most collection actions against the debtor §11 U.S.C. § 362(a).

• Wage Garnishment (garnishment orders must be released)
• Foreclosure proceedings and sales
• Vehicle repossession
• Collection calls, letters, and harassment
• Utility disconnection (for 20 days) §11 U.S.C. § 366
• Lawsuits and judgment enforcement
• Bank account levies and freezes
• IRS levies and most tax collection (with exceptions)

• Criminal proceedings against the debtor
• Most domestic support enforcement (child support, alimony collection)
• Tax audits (though tax collection is stayed)
• Eviction where a judgment for possession was entered before filing (in most cases)
• Actions by governmental units exercising police or regulatory power

First filing: stays in effect until the case is closed, dismissed, or discharge is granted

Second filing within one year §11 U.S.C. § 362(c)(3)

If a prior case was dismissed within the last year, the stay automatically expires after 30 days unless the debtor files a motion to extend it. The debtor must show the current filing is in good faith.

Third or more filings within one year §11 U.S.C. § 362(c)(4)

If two or more cases were dismissed within the last year, no automatic stay takes effect at all unless the debtor obtains a court order within 30 days of filing.

A creditor can file a motion for relief from stay §11 U.S.C. § 362(d), asking the court to allow collection to proceed despite the bankruptcy. Common grounds:

• "For cause" — the debtor has no equity in the property and it is not necessary for reorganization
• The debtor is not making adequate protection payments on a secured debt (mortgage, car loan)
• The filing was made in bad faith to delay a specific creditor