Chapter 13 Bankruptcy: What is a Motion to Extend Automatic Stay?

In most bankruptcy cases the automatic stay goes into effect upon filing the bankruptcy case and stays in effect until the case is dismissed or closed after discharge. However, if a debtor filed a Chapter 13 case which was dismissed and then files a second Chapter 13 case within one year of the dismissal date of the first order, the stay expires after 30 days in the second case unless the court signs an order extending the stay. In order to obtain an order from the court extending the stay the debtor files a Motion to Extend Automatic Stay.

These types of Chapter 13 bankruptcy motions have very specific rules associated with them. First, the creditors must be given notice of the hearing 23 days in advance. Second, the hearing must take place within 30 days of the filing date. This means that there is a 7 day window during which the hearing can take place. Sometimes the court in which the case is filed doesn’t have a hearing date within the time period that satisfies the rules regarding these motions. If there is a hearing date a few days before the 23rd day the debtor can file a Motion to Shorten the Notice Requirement. These motions generally don’t require a hearing and the court will grant them if the notice period isn’t shortened too significantly.

The debtor must attend the hearing so that they can testify in support of the motion. The debtor will usually give testimony explaining why the first bankruptcy case was dismissed and why the second bankruptcy case will be successful. If the debtor is convincing the judge may grant the motion extending the automatic stay for the duration of the bankruptcy case. Creditors rarely oppose these motions in North Texas bankruptcy courts.