Home  /  Practice Areas  /  Creditor-Side Bankruptcy

Bankruptcy Is Not a Pause — It Is a Deadline

When a borrower or obligor files for bankruptcy protection, the automatic stay immediately halts collection activity, foreclosure proceedings, and enforcement actions. For creditors who are unprepared, this pause becomes a loss — of collateral value, of priority, of the ability to enforce rights that existed before the filing. Nemovi Law Group represents creditors who understand that bankruptcy is not the end of a matter but the beginning of a new and time-sensitive legal process requiring specific expertise.

We appear in all four California federal bankruptcy districts — the Northern, Eastern, Central, and Southern Districts — and have experience in additional jurisdictions. Our creditor-side practice spans institutional lenders, mortgage servicers, credit unions, private lenders, landlords, and unsecured creditors with significant claim exposure. We do not represent debtors.

Effective creditor representation requires understanding the interaction between bankruptcy law and the underlying state law rights the creditor holds. A secured lender's rights in a California deed of trust, a Nevada junior lien position, or an unsecured judgment creditor's treatment in a Chapter 11 plan all require analysis that begins with state law and is layered with the Bankruptcy Code. We bring both dimensions to every matter.


What We Handle

Relief from Automatic Stay

Motions for relief from the automatic stay under 11 U.S.C. §362(d) to permit foreclosure, repossession, or other enforcement action against collateral. Includes adequate protection analysis and negotiation.

Proof of Claim

Preparation and filing of proofs of claim, including secured claim documentation, arrearage calculations, and response to objections filed by debtors or trustees.

Chapter 11 Plan Objections

Analysis and objection to proposed reorganization plans that impair creditor claims, strip liens, or fail to satisfy confirmation requirements under the absolute priority rule.

Chapter 13 Plan Confirmation

Review and objection to Chapter 13 plans that propose cram-down of secured claims, modification of mortgage terms, or improper treatment of arrearages.

Adversary Proceedings

Prosecution and defense of adversary proceedings, including nondischargeability actions (11 U.S.C. §523), lien avoidance actions, and preference and fraudulent transfer defenses.

Lien Stripping Defense

Opposition to debtor motions to strip or avoid junior liens on real property in Chapter 11 and Chapter 13 cases.

Adequate Protection Agreements

Negotiation and documentation of adequate protection arrangements providing secured creditors with ongoing protection of their collateral interest pending stay relief.

Post-Discharge Foreclosure Coordination

Resumption of foreclosure proceedings following discharge, dismissal, or stay relief, including coordination with foreclosure counsel and servicer compliance review.


The Work We Do

The following represent the types of matters we regularly handle. No client names or confidential information is disclosed.


Creditor Bankruptcy FAQ

What does the automatic stay actually prohibit?
The automatic stay under 11 U.S.C. §362(a) is broad. It prohibits any act to obtain possession of property of the bankruptcy estate, any act to create, perfect, or enforce a lien against estate property, the commencement or continuation of judicial proceedings against the debtor, and any act to collect a pre-petition debt. For secured creditors, this means foreclosure, repossession, and enforcement are all stayed immediately. Violations of the automatic stay can result in sanctions, damages, and attorney fee awards against the creditor.
How quickly can a creditor obtain relief from the automatic stay?
Under 11 U.S.C. §362(e), the bankruptcy court must hold a preliminary hearing within 30 days of a stay relief motion and a final hearing within 30 days thereafter. In practice, the timeline depends on the court's docket, the complexity of the matter, and whether the debtor contests the motion. Uncontested stay relief motions in routine cases are sometimes resolved by stipulated order in 30 to 45 days. Contested matters may take longer. Emergency or in rem relief is available in cases involving serial filers or where the property is at imminent risk.
What is "adequate protection" and why does it matter?
Adequate protection is the mechanism by which the Bankruptcy Code compensates a secured creditor for any diminution in the value of its collateral resulting from the automatic stay. A creditor can request adequate protection as a condition of not seeking stay relief — or as part of a contested stay relief hearing. Adequate protection can take the form of periodic cash payments, additional liens, or other relief designed to ensure the creditor's secured position is not eroded during the bankruptcy proceeding.
What is a cram-down and how does it affect secured creditors?
Cram-down allows a debtor to confirm a Chapter 11 or Chapter 13 plan over a secured creditor's objection if the plan provides the creditor with the present value of its collateral — even if that amount is less than the outstanding loan balance. For real estate secured creditors, cram-down can reduce an oversecured loan to the appraised value of the property and modify the interest rate. Challenging the debtor's valuation and the terms of the proposed treatment is a key aspect of creditor representation in cram-down scenarios.
Does a Chapter 7 discharge eliminate a mortgage lien?
No. A Chapter 7 discharge eliminates the debtor's personal liability on the mortgage debt, but it does not eliminate the lien itself. The lien remains attached to the property and survives the bankruptcy. A secured creditor can still proceed with foreclosure after discharge — the creditor simply cannot seek a personal deficiency judgment against the debtor. This is why post-discharge foreclosure coordination is an important part of creditor representation.
What is an adversary proceeding and when should a creditor file one?
An adversary proceeding is a lawsuit filed within the bankruptcy case governed by Part VII of the Federal Rules of Bankruptcy Procedure. Creditors typically file adversary proceedings to obtain a determination that a debt is nondischargeable (e.g., based on fraud, willful injury, or fiduciary breach), to avoid a transfer, or to object to the debtor's discharge entirely. Nondischargeability actions under §523(a)(2) or (a)(6) must be filed within strict deadlines — typically 60 days from the date first set for the meeting of creditors. Missing this deadline can permanently bar the claim.

Need Creditor Representation
in a Bankruptcy Proceeding?

We review all inquiries and respond within one business day.

Contact Nemovi Law Group