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Will filing bankruptcy stop an eviction?

If you are renting a property, receiving an eviction notice is probably one of the most stressful things that can happen to you as a tenant. There are several steps you can take to avoid your landlord asking you to love your property. If you are wondering whether will filing for bankruptcy stop an eviction, read below to find out everything you need to know about the requirements for stopping an eviction through this process.

How do Chapters 7 and 13 Bankruptcy affect the eviction process?

If you decide to file for bankruptcy, its automatic stay order would stop many forms of litigation, including getting evicted by your landlord. However, this has to be done before your landlord receives a possession order from the court-also called an “unlawful detainer” (UD). The automatic stay goes into effect when you file for bankruptcy and will prevent your landlord from starting the UD action. However, in most states in the US, both Chapters 7 and 13 of Bankruptcy will only stop the eviction temporarily. In California, you will have to catch up on the past due amounts to stay.

Chapter 7 Bankruptcy eliminates past due rent and if you file for it, you will have to give up any assets which are not “exempt”. If you would like to stay in your rented property, you are however required to pay any rent you owed within 30 days of filing for bankruptcy. If you decide to move out, you won’t have to pay back anything you owe to your landlord.

To qualify for a Chapter 13 bankruptcy, you need to meet some income and debt criteria. If you file for it, you can propose a repayment plan to your landlord, and pay back any rent owed over 36-60 months.

So if you are considering filing for eviction, you should get in touch with a specialist who can give you the right advice and guide you on the matter. You should also ask yourself if you can afford to pay the rent going forward, how long is left on the lease agreement or if you can arrange for alternative living.

When does bankruptcy not stop an eviction?

Filing for bankruptcy will not stop an eviction in two situations. If your landlord is claiming that you are endangering the property in some way (or using illegal substances), you can be evicted even after the bankruptcy is filed. In this case, the landlord has to also file a certification to the court to sustain his allegations (which you can also dispute).

The second situation where the eviction process will go ahead even if you filed for bankruptcy is when your landlord obtained the unlawful detainer (UD) from the court before the bankruptcy is filed. This court order gives the landlord the right to take possession of the property and bankruptcy will not prevent this from happening.

The takeaway

Facing an eviction process can be very stressful, especially if combined with financial difficulties. As seen above, filing for bankruptcy can help in stopping an eviction, but in some cases, this is a temporary solution.

If you are worried about losing your rental property, get in touch with our expert team who can give you the advice and support you need!