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What is relief of stay?

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Wiki User
12/17/2011

Filing a bankruptcy automatically "stays" almost all actions against the debtor. It gives the debtor a temporary hiatus from actions by creditors although it is not permanent and as the procedure progresses the debtor's property may eventually be distributed.

A creditor's lawyer, especially a foreclosing bank, can seek a "relief from stay" by filing a motion with the court. If the motion is granted the creditor can go ahead and foreclose on the property and sell it to satisfy its debt. That usually happens when there is no equity in the property.