Tenants who are facing eviction may be able to continue living in their rental property longer and prevent eviction by filing a Chapter 7 bankruptcy. This depends on whether the landlord has already obtained a judgment for possession of the premises.
The act of filing bankruptcy enables the court to enact an automatic stay. The automatic stay goes into effect immediately upon filing, and prevents creditors from contacting the debtor or continuing their collection process. However, there are exceptions where a landlord can still evict a tenant.
In 2005, bankruptcy law was revised to add the Bankruptcy Abuse Prevention Consumer Protection Act to give landlords more power to evict tenants who file for bankruptcy. Before, if a tenant filed bankruptcy, the tenant would be granted an automatic stay even if there was already a judgment for possession. Under today’s bankruptcy law, when a judgment for possession is issued before a tenant files bankruptcy, the landlord does not have to comply with the automatic stay and may continue the eviction process. Another exception to the automatic stay rule is when a tenant is being evicted for endangering the property or using illegal substances on the rental property.
In general, once a tenant has filed bankruptcy the automatic stay should prevent the landlord from beginning the eviction process for past due rent. A landlord may counter this by filing a motion for relief of the automatic stay with the court. If the court grants this motion, the landlord will be allowed to proceed with the eviction process. A judge will likely grant the landlord’s motion unless the tenant has a compelling reason why the eviction should not occur.
If the landlord believes the tenant has engaged in illegal drug use on the property or has endangered the property, the landlord can circumvent an automatic stay without a court order. To proceed with an eviction without a motion, the landlord simply files a certification with the court. This certification must state either the landlord already has an eviction order stemming from the same allegations, or it can state the tenant has engaged in illegal drug use or has endangered the property within the last 30 days. If the tenant does not object to this certification, the eviction process will continue after 15 days. A tenant who does object to the certification will usually be granted a court hearing within a reasonable time to allow the court to decide the issue.
For more information on how to stop an eviction through bankruptcy, contact bankruptcy attorney Kendal Sanders with the Law Office of David M. Goldman PLLC at (904) 685-1200.