Will Filing for Bankruptcy Protect me from Eviction?

Your finances are a disaster, and you’ve spent more time dodging creditors than you’d like to admit. You’re so far behind on your bills that you’ve started to worry about the possibility of being evicted–and then what? The thought of being homeless scares you to death, and you’ll do whatever it takes to avoid that.  Will filing for bankruptcy eliminate that possibility? The answer is yes–but perhaps only temporarily.

In the Short Term… 

Filing for bankruptcy means the court will issue an automatic stay, stopping creditors from harassing you. That means not only will credit card companies and car dealerships get off your back–so will your landlord or the organization holding the note on your home.

A Caveat for Renters

The stay will provide temporary protection from creditors, although if there is already a judgment for your eviction from a rental property, the stay may not apply. An eviction judgment is the last step in a landlord’s efforts to evict based on either nonpayment, violation of rental terms, or illegal actions on the property. It occurs after the landlord has already given notice to vacate and renters have refused to leave. Notably, even if there is no prior judgment and there is a pause in eviction efforts, a landlord can ask the court to lift the stay as it applies to their property.

Disputes Between the Tenant and Landlord

Assuming you and your landlord are in disagreement as to the amount of back-rent owed, your bankruptcy could wipe away your obligation for back-rent. Future rent obligations, however, will not be impacted.

There are Exceptions

Worth noting is that landlords are allowed to pursue eviction in certain situations, such as if tenants have engaged in illegal drug activities or if the property has been seriously damaged or jeopardized.

When You Own Your Home 

For homeowners who are behind on their mortgage payments, the degree of relief depends on the type of bankruptcy:

• Chapter 7 bankruptcy pauses foreclosure proceedings in order to give the homeowner time to relocate, or, in certain situations, get caught up on payments.
• Chapter 13 bankruptcy can eliminate foreclosure proceedings altogether if a repayment plan can be arranged that makes it more realistic for you to get on top of your mortgage debt.

Can Bankruptcy Help You? 

At the very least, filing for bankruptcy could slow down any eviction. In the best-case scenario, it can help you to restructure your debt and maintain your living arrangements. In any case, it will help with debt that is not related to your living expenses, giving you more breathing room to locate living arrangements that are affordable since your credit card and other debt will be addressed through the bankruptcy. To address all of the possibilities, schedule a confidential consultation with the experienced Miami bankruptcy attorneys at The Law Office of Julia Kefalinos today.