Your landlord may not automatically evict you from your apartment just because you sought bankruptcy protection from your creditors. Your ability to keep your apartment depends on the type of bankruptcy that you file, the status of your rent payments to your landlord, and whether you keep your lease. Bankruptcy, however, does not prevent your landlord from removing you from the rental unit if eviction procedures were initiated before you filed your bankruptcy petition.
If your landlord has already filed suit and obtained a court order evicting you from your apartment, your bankruptcy filing will not stop the eviction from occurring. Although you obtain an automatic stay, halting eviction and other debt collection efforts by your creditors, your landlord can seek permission from the court to evict you from your apartment for unpaid rent. Unless you immediately pay any back rent, bankruptcy law allows your landlord to restart the eviction 30 days after you file your bankruptcy petition.
Chapter 7 Bankruptcy
If you have few assets and do not earn much money, you probably have filed for Chapter 7 bankruptcy. In a Chapter 7 bankruptcy, the court-appointed trustee is assigned authority to determine whether to assume or reject your lease. If the trustee rejects the lease, or lets 60 days go by without reaching a decision on your lease, then your landlord can resume eviction procedures even though your bankruptcy case is still pending. Once your bankruptcy case is discharged and the protections from your creditors end, your landlord may also seek damages for your breaking the lease.
Read More: Are Apartment Leases Dischargeable in Chapter 7 Bankruptcy?
Chapter 13 Bankruptcy
If you have assets that you want to protect from liquidation, or you make too much money to qualify for Chapter 7 bankruptcy, you may file for Chapter 13 bankruptcy. After filing a Chapter 13 petition, you are required to file a repayment plan with the court indicating whether you plan to continue with your lease and other proposed terms for repaying your creditors. Once the plan is approved, you are placed on a court-supervised repayment plan for three or five years. If you chose to reaffirm your lease, then your rent payments are included as part of your bankruptcy payment plan.
Assuming the Lease
If you assume your lease during bankruptcy, you are renewing your promise to pay your landlord and abide by all terms in the rental contract. If you were delinquent in your rent at the time you filed your bankruptcy petition, you are required to make catchup payments before the court will allow you to assume the lease. In assuming the lease you are committing to the same terms that were agreed to prior to your bankruptcy filing. The court does not have authority to extend or reduce your rent payments or otherwise modify the terms of your lease. If you fail to meet your rent payment obligations after assuming your lease in bankruptcy, your landlord may evict you for this new breach despite your pending bankruptcy case.
If you file bankruptcy solely in order to delay eviction, you are committing an abuse of the bankruptcy system and are perpetrating a fraud on the court. In these cases the bankruptcy court may dismiss the petition without discharging your debts. You will then be subject to eviction and possibly be sued for your back rent and your landlord's attorney's fees and court costs.
- Huddleston Law Offices: My Tentant Just Filed Bankruptcy, Now What?
- Bernstein-Burkley, P.C.: When a Residential Tenant Files Bankruptcy
- Cooper, White & Cooper, P.C.: Rules of Thumb for Landlords Facing a Tenant's Bankruptcy
- Morrell Saffa Craige, Attorneys at Law: Bankruptcy and Eviction: A Landlord’s Perspective
- Barna, Guzy and Steffen, Ltd.: Bankruptcy Overview and the Unexpired Lease
- San Francisco Apartment Association: What To Do When Your Tenant Declares Bankruptcy
Kevin Owen has been a professional writer since 2005. He served as an editor for the American Bar Association's "Administrative Law Review." Owen is an employment litigator in the Washington D.C. metropolitan area and practices before various state and federal trial and appellate courts. He earned his Juris Doctor from American University.