Can I be evicted if I file Chapter 7 bankruptcy? One of the major concerns for people when they file for bankruptcy is the fear of losing their homes. In Florida, bankruptcy attorneys are there to assist folks who are anxious about facing foreclosure when they file for bankruptcy.
But what about those who rent their houses? What happens if I declare bankruptcy while renting from my landlord? Here’s everything I should know.
When considering bankruptcy, it is important to be aware of how it activates various financial protections. When filing, certain safeguards automatically come into play and cover your income, assets, and resources. Most of these protections typically last for as long as your bankruptcy case.
These protections usually apply to the assets that you own. However, renters can also find some protection, like shielding them from eviction. But it’s essential to understand that it’s not a sure thing. In specific situations, landlords might still be able to evict tenants who have declared bankruptcy.
Are You Filing for Chapter 7 or Chapter 13?
What a landlord can and cannot do depends on whether the person has filed for Chapter 7 bankruptcy or Chapter 13 bankruptcy.
In Chapter 7, all debts included in the bankruptcy are wiped away. Court-appointed bankruptcy trustees have the ability to end an unreasonable or unaffordable lease agreement. If a tenant wishes to continue renting from them, landlords can request proof that they can afford future rent payments; failing this, landlords can seek court approval to end the lease contract altogether.
Chapter 13 gives renters more control. If someone can manage both their bankruptcy and rent payments, Chapter 13 can stop a landlord from evicting them if they want to keep the lease. This means that money owed to the landlord is considered a higher priority than other unsecured claims if Chapter 13 later changes into Chapter 7.
Additionally, the landlord can ask the bankruptcy court to deduct money from the debtor’s wages. The trustee can then send this money to the landlord as part of the Chapter 13 repayment plan. If the debtor doesn’t follow the plan, the landlord can legally evict the tenant.
Both Chapter 7 and Chapter 13 bankruptcy trigger something called an “automatic stay.”An injunction is an order from a court that puts an immediate stop to all debt collection activities, including any eviction proceedings.
An eviction may only take place when a landlord believes their tenant has damaged the property or is using it illegally. Otherwise, they must file court papers to seek permission to evict on these grounds.
Filing for bankruptcy automatically affects your lease agreement, regardless of whether or not rent has been paid on time and other terms of it have not been violated.
Important to remember when going through bankruptcy or eviction laws vary across states, so it’s always wise to consult an attorney. They can provide invaluable resources that could protect you from homelessness when going through this process.
How to Use Bankruptcy and Stop Eviction in Florida
Bruner Wright P.A. has a license to practice law in Florida. If you want to talk about a legal issue and are not located in Florida, contact the Bar Association of your state to find a lawyer who can help you. Thank you.
The COVID-19 Pandemic has impacted all Floridians. Numerous businesses closed, leading to hundreds of thousands of Floridians losing their jobs and many facing the threat of home loss due to unpaid rent or fear of eviction.
Governor DeSantis implemented a moratorium on foreclosures and evictions during the pandemic to ease fears that stay-at-home orders might cause homeowners to lose their homes; unfortunately, these moratoriums have been in place for an extended period and may never return.
As many Florida residents remain under-served, the risk of foreclosure and eviction remains an ever-present worry. People may wonder whether filing bankruptcy could help stop an eviction or stop foreclosure proceedings; as is often the case with legal questions. However, this depends on your individual situation. If considering filing as a way out it’s essential that you consult an experienced Florida lawyer immediately for advice.
Bankruptcy Will Provide an Automatic Stay
When you file for Chapter 7 or Chapter 13 bankruptcy, the court imposes something called an “automatic stay.” This stay puts a stop to creditors trying to contact you or collect the debts you owe. The automatic stay begins immediately, meaning that once your case is filed, creditors and debt collectors can’t reach out to you. But, it might not work the same way for landlords attempting to collect rent or evict you.
The automatic stay doesn’t last indefinitely, and for landlords, it might only last a short time. Many courts grant landlords’ requests to lift this automatic stay quickly. If this happens, the landlord can restart the eviction process, and you could face eviction.
The time it takes to lift the automatic stay can be an opportunity. If you believe an eviction is imminent, you can use this time to find a new place to live or catch up on any overdue rent if you can manage it.
If you’ve filed for Chapter 7 bankruptcy, your landlord might wait until your bankruptcy case is over before proceeding with an eviction, which could take three to four months. However, if you haven’t paid rent, your landlord may still be able to evict you once the bankruptcy case concludes.
It’s important to note that the automatic stay won’t prevent an eviction if your landlord already obtained a final judgment for eviction against you before you filed for bankruptcy. Automatic stays only apply to the debts you had at the time of filing.
Bankruptcy Can Eliminate Unpaid Debt
Filing for Chapter 7 bankruptcy can delay an eviction but won’t completely stop it. Once evicted, Chapter 7 bankruptcy can help erase any outstanding rent debt and relieve you of a lease commitment for your current place – prompting many people to turn to this form of relief to prevent eviction altogether. For those struggling with high rent costs, this might be just the solution they need!
Rent arrears can make finding a new home challenging, as you will need to come up with the first and last month of rent as well as security deposits and moving costs. Filing for bankruptcy can help clear away other unsecured debt such as credit card bills or medical bills that don’t have collateral backing them up, freeing up funds for your new house purchase.
Filing for bankruptcy has consequences that should be carefully considered before taking this step. Your credit report will show evidence of bankruptcy filing, which potential landlords could use when considering whether to rent to you in the future. Some people attempt to prevent this by moving before declaring bankruptcy.
Chapter 13 Bankruptcy Can Help You Avoid Eviction
Chapter 13 bankruptcy could provide an avenue to avoid eviction when Chapter 7 does not. Under Chapter 13, your debts won’t be discharged but instead, you ask the court to reorganize them into a structured repayment plan that incorporates both current and future rent payments allowing you to remain in your current home.
Chapter 13 plans are created with manageability in mind, taking into account your income and expenses. It’s essential to stick to this repayment schedule. If you don’t, your landlord may raise concerns about your missed payments, and your case could be dismissed. In case you continue to miss payments, your landlord can bring the issue to the bankruptcy trustee, which may lead to the dismissal of your case.
Contact Our Bankruptcy Attorney in Florida Today
Bankruptcy can stop you from getting kicked out of your home, but it’s not a quick or simple solution. It’s really important to talk to a bankruptcy lawyer in Jacksonville, Florida who can help you with your specific situation.
Services We Offer:
- CHAPTER 7 BANKRUPTCY
- CHAPTER 11 BANKRUPTCY
- CHAPTER 12 BANKRUPTCY
- CHAPTER 13 BANKRUPTCY
- BUSINESS BANKRUPTCY
- PERSONAL BANKRUPTCY
- BUSINESS LITIGATION