If you have missed a few months of paying rent, your landlord may threaten to evict you. If you have nowhere else to live, this can be a stressful predicament. Filing bankruptcy may alleviate some stress as it can slow down the process of being evicted.
When Can You File For Bankruptcy
You can file for bankruptcy and hope to gain some relief if three conditions are met. The landlord cannot have filed with the court for possession of the property, you must be able to pay one month's rent immediately, and you must be able to pay the rest of the rent within 30 days.
Filing Bankruptcy Before Your Landlord Files to Evict
Evictions do not come out of the blue. You know when you have missed a rent payment. Often, your landlord will let you know you have missed the payment and inform you of any fees associated with late payments. If you go too long without paying, your landlord will request that you leave.
Some landlords serve you with a quit notice prior to filing a formal eviction. If your landlord does send you a quit notice, you will have between 14 and 30 days to do something to impede the eviction. Filing for bankruptcy before your landlord files for eviction will trigger an automatic stay. While you are going through a bankruptcy, creditors, including your landlord, are not able to contact you or attempt to collect on the debts you owe. Your landlord will not be able to file an eviction.
Paying Advance Rent
When you file for bankruptcy, you will need to pay the trustee any amount of rent that will come due within 30 days. Additionally, as more rent becomes due, you will have to pay it, in advance, to the bankruptcy trustee. This ensures you do not incur more bad debt as you move forward.
Paying Delinquent Rent
You will be required to pay the delinquent rent to your landlord if you plan on staying in the same property. You should pay this prior to the bankruptcy being discharged, a process that takes anywhere from 30 to 90 days.
Filing Bankruptcy After Your Landlord Has Begun Eviction Proceedings
If your landlord files for possession of the property before you file for bankruptcy, the eviction proceedings will go on until you are forced to move. Thankfully, the money you owe for back rent can be discharged in the bankruptcy, but you will have to move as soon as you start the bankruptcy proceedings.
When you are in dire financial straits, bankruptcy is a great option to alleviate your stress. If you file in time, you can save yourself from eviction. Be sure you are able to pay any rent due during the bankruptcy, and you can pay any past due amounts very soon. Then contact a bankruptcy attorney from a firm such as Wiesner & Frackowiak, LC to assist you through the process.