How Bankruptcy Can Be Used to Fight Eviction

One of the principal benefits of bankruptcy is that it imposes an automatic stay on debt collection. If you are a residential tenant, the automatic stay puts an immediate halt to certain actions against you, including efforts to collect overdue rent. If you are at the point where you are facing eviction, filing bankruptcy may buy you some time in the residence, during which you may be able to restructure your rental debt.

The effectiveness of using bankruptcy to stop eviction depends on timing. If you file for bankruptcy before the landlord obtains an eviction judgment, the landlord will not be able to evict you right away. They must first petition the bankruptcy court and request that the automatic stay be lifted. You’ll be allowed to stay in the residence while the landlord’s petition is working its way through the court. But be aware that judges typically lift the stay when a landlord requests it, because the property you are renting does not impact the value of your bankruptcy estate.

If you file for bankruptcy after the landlord has obtained a writ of possession — that is, a court order allowing them to evict you — then the automatic stay will not protect you from eviction. The only exception is that if you are being evicted solely for failing to pay rent, you can avoid eviction by paying all past due rent within one week of getting the notice of eviction. This is called “curing” the rent delinquency. If you are being evicted for a reason other than unpaid rent, then the landlord will be able to proceed with the eviction.

Remember, filing for bankruptcy is a stop-gap measure. It cannot be used as way to force a landlord to provide long-term housing for free. However, if you file for Chapter 13 bankruptcy, also known as a debt repayment plan, it is possible that your rent and past-due rent could be restructured as long-term debt. You may be able to remain in the residence, at least through the end of your current lease term. If you are at or near the end of your lease when you file for bankruptcy, you may need to find a new place to live unless the landlord is willing to offer you a new rental agreement.

Jeff Field & Associates has helped Atlanta-area renters get relief from evictions by filing for bankruptcy. Our attorneys will quickly assess your situation and advise you of your options if you give us a call at 404-381-1278 or contact us online. We have offices conveniently located in Bogart, Douglasville, Gainesville, Lawrenceville, Marietta and Scottdale.