If a person is going to file a Ch. 11 as an individual, and there is a foreclosure sale on one of his properties scheduled a day or two thereafter, is the foreclosure stayed and what type of service/notice must be be given to the creditor involved?
1 Answer from Attorneys
If the property is titled in any respect in that person's name, and that person files for bankruptcy relief under any of the chapters, the automatic stay would bar/stay any foreclosure activity subject to the creditor's motion to lift the stay. The creditor who is foreclosing should receive a "Suggestion of Bankruptcy" so that it will know to stop the sale - that is the best course of action.
The bankruptcy debtor and the debtor on the note must be identical in order for the stay to be effective. You should have your chapter 11 counsel review your situation to make sure the filings would protect you in your individual capacity as property owner.
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