If you are facing eviction proceedings, filing bankruptcy may allow you to stay in the property longer or give you the opportunity to become current on your rent and remain in the property. Whether bankruptcy stops an eviction depends on whether or not your landlord has already obtained a judgment for possession of the premises. Read on to learn more about how a bankruptcy can help you if you face eviction.
When you file a bankruptcy, an automatic stay immediately goes into effect that prohibits your creditors from contacting you or continuing their collection efforts. However, Congress has created exceptions to this automatic stay for certain creditors. Some of these exceptions related to landlords and evictions.
(To learn more about the automatic stay, see How Bankruptcy Stops Your Creditors: The Automatic Stay.)
If you file a bankruptcy after your landlord has already obtained a judgment against you for possession of the property, then bankruptcy does not provide much protection. If your landlord has a judgment for possession of the property, he or she can usually continue with the eviction process even if you subsequently file for bankruptcy. However, if you live in certain states, you may be able to temporarily stop the eviction and get caught up on your rent.
If you live in a state that permits renters to cure their rent default even after their landlord has obtained a judgment for possession, then bankruptcy can provide you with more time in the property and an opportunity to bring your rent current.
In order to stop the eviction, when you file your case you must also file a certification with the court (and serve it on your landlord) stating that your state’s laws still allow you to cure your default after a judgment for possession is entered. At that time, you must also deposit with the court clerk the amount of rent that will become due within 30 days after the bankruptcy filing. Then, you will have 30 days from the date of your bankruptcy to pay back all rent arrears owed and file another certification to that effect. If you cure the entire default and file the certification within the 30 days, then the stay will remain in effect and your landlord cannot proceed with the eviction.
If you have already filed a bankruptcy before your landlord has obtained a judgment for possession of the property, then the automatic stay stops the landlord from starting the eviction proceedings or giving you a termination notice. However, be aware that your landlord can file a motion (ask the court) for relief from the automatic stay to proceed with the eviction. Bankruptcy judges will usually grant the landlord’s request unless you have a compelling reason why the eviction should not go forward.
Even if you already filed a bankruptcy before your landlord got a judgment for possession, if your landlord is alleging that you have engaged in illegal drug use in the property or have otherwise endangered it he or she can proceed with the eviction without requesting relief from the automatic stay from the court.
To do this, your landlord must file a certification with the court stating that an eviction action was already filed on these grounds or that you have used illegal drugs on the premises or endangered the property within the last 30 days. If you don’t object to the landlord’s certification within 15 days, he or she can then continue with the eviction. If you object, then the court will hold a hearing within 10 days of your objection to decide the issue.