Evictions in Bankruptcy

Debtors filing bankruptcy have some protection from eviction while in bankruptcy. However, this protection depends on how far in the eviction process they are when the bankruptcy is filed. Whether an eviction judgment has been obtained makes all the difference in whether a bankruptcy filing will hold off the proceedings.

If you are current on rent payments and you file Chapter 7 or Chapter 13, the bankruptcy should have no effect on your lease and tenancy. Although the landlord may not be thrilled with the idea that you filed for bankruptcy, they likely will not even find out about it. Since you are current on your rent payments, you do not have to list the landlord as a creditor who would be entitled to notice of the proceedings.

If you are behind on rent payments when you file it is likely that the landlord may have already filed an action in state court against you to evict you. If you file before bankruptcy BEFORE the court issues a judgment for possession, the automatic stay of the bankruptcy will prohibit the landlord from trying to evict you on prepetition rent payments unless they first file a motion for relief from stay. If you do not stay current on post-petition rent payments, the landlord is free to seek eviction on the postfiling rent payments.

If the landlord already has a judgment for possession of the apartment when you file for bankruptcy, the automatic stay will not help you. The landlord is entitled to proceed with the eviction just as if the bankruptcy was never filed.

The landlord can ask the court to lift the automatic stay to begin or continue eviction on any grounds. Although the automatic stay is automatically applied, unless the landlord already has a judgment, the Judge can also list the stay upon landlord’s request. Given that the tenancy is not a property of the bankruptcy that the trustee can sell to pay your creditors, bankruptcy courts lean toward allowing landlords to exercise their property rights to protect their property regardless of the tenant’s debt problems.

An exemption to everything listed above is if the landlord is seeking an eviction because you endangered the property or engaged in illegal use of controlled substances on the property. In this situation, the landlord can start an eviction you regardless of the status of the bankruptcy even after the filing date if the eviction is based on property endangerment or drug use.