Which of the Following Is False Regarding Actions That May

question 26

Multiple Choice

Which of the following is false regarding actions that may be taken while an automatic stay is in effect in a Chapter 7 proceeding?

• A) Creditors cannot attempt to repossess property during bankruptcy proceedings.
• B) A creditor who received a judgment against a debtor prior to the bankruptcy filing may not act to enforce the judgment.
• C) Legal actions to collect child support payments are subject to the stay.
• D) The court may exclude secured creditors from the stay if they petition the court to show that they do not have adequate protection under the stay.
• E) If the debtor was a debtor in a bankruptcy case that was dismissed within a year of the current bankruptcy case filing, the stay automatically terminates 30 days after the current filing.

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Definitions:

Operating Lease

A lease agreement that allows the use of an asset but does not convey rights of ownership of the asset.

Sale and Leaseback

A transaction where a company sells an asset and leases it back from the new owner, allowing the company to use the asset while freeing up capital.

Temporary Cash

Cash held for short-term purposes or to cover near-term obligations.

Financial Ground

The state of financial stability or condition of an individual or organization.