Using Bankruptcy to Stop Eviction
Vernon bankruptcy attorney helps clients stay in their rented residences
If you face eviction for failure to pay rent, your options are limited because you can only resist an eviction proceeding for so long. However, if you file for bankruptcy before the eviction order, it places an automatic stay on the eviction proceedings, giving you time either to catch up on your rent payments or to look for another suitable place to live. In either case, the Law Offices of James C. Zimmermann can advise on how your bankruptcy might help you fight eviction in New Jersey.
Using Chapter 7 to delay eviction
Chapter 7 bankruptcy allows you to liquidate your nonexempt debts by authorizing a bankruptcy trustee to sell your property not covered by bankruptcy exemptions. At the end of the process, the court will discharge (that is, cancel) eligible debts, including back rent. If all of your property is exempt, which is often the case for renters, you might even be able to obtain a discharge and keep everything you own. Although you might not be able to catch up on your overdue rent, you will still have time to find another residence, and the discharge will allow you the fresh start you need to keep current with your new rental obligations.
Using Chapter 13 to catch up on rent payments
Another option which can lead to keeping your house in bankruptcy is a Chapter 13 proceeding, in which you must pay a certain amount of money each month to repay your debts to your creditors for three to five years. You can use this extended period to pay off your arrearages, while meeting your current rent obligations. As in a Chapter 7 case, the automatic stay protects you from being evicted. Furthermore, once you complete the repayment schedule the court will discharge any rent you were unable to repay through the plan, making it easier for you to avoid falling behind on rent again.
When a landlord files for eviction before tenant bankruptcy
Often, tenants wait until their landlords file a proceeding seeking their eviction for non-payment of rent before filing for bankruptcy. Even then, the automatic stay will stop the eviction process until the end of the bankruptcy case, unless the bankruptcy court lifts the automatic stay to allow your landlord to proceed. We will, of course, fight lifting the stay if we represent you. The court is more likely to deny the landlord’s request in a Chapter 13 case, since you will be catching up on rent obligations through the payments to the bankruptcy trustee. In New Jersey, you can’t be evicted if the full amount of the rent is paid, so you might avoid eviction entirely.
Protecting credit and future housing options
At least some landlords may be reluctant to rent to you during or after a bankruptcy, because a recent bankruptcy may lower your credit rating. However, a bankruptcy discharge may work in your favor, because it makes it easier to afford rent in the future and prevents you from obtaining another discharge of debts for several years.
Steps we can take to halt eviction through a bankruptcy filing
The first step to using bankruptcy to stop your eviction is to consult with a seasoned bankruptcy attorney. We will evaluate your options and help you choose the bankruptcy chapter that is most likely to work for you. From there, we will file your bankruptcy as soon as we reasonably can. A Chapter 7 case is likely to take months, while the Chapter 13 repayment plan will take three to five years to complete. We’ll fight to protect your interests throughout the process.
Contact our New Jersey bankruptcy firm if you’re facing eviction due to debt
Call The Law Offices Of James C. Zimmermann at 973-764-1633 or contact us online to discuss ways to fight eviction through bankruptcy. We have five North Jersey offices, in Vernon, Wayne, Pompton Lakes, Hackensack and Nutley.
