Practice Quiz

Paralegal Exam Prep

Category - Legal Envrmt

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Under what circumstances can a creditor receive relief from an automatic stay?
  1. A creditor cannot receive relief from an automatic stay.
  2. If the debtor filed a Chapter 15 bankruptcy.
  3. If the debtor filed a Chapter 11 bankruptcy.
  4. When the creditor can show that the debt owed is before a statutory timeframe.
  5. When the creditor can show that the automatic stay does not give the creditor adequate protection.
Explanation
Answer: E. A creditor can receive relief from an automatic stay when the creditor can show that the automatic stay does not give the creditor adequate protection. An automatic stay is an injunction that prohibits creditors from continuing to try to collect the debt. There are certain collection actions that are not subject to an automatic stay, such as efforts to collect back taxes or child support.
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