Can Bankruptcy Stop An Eviction?

Many Americans are currently dealing with past due rent payments that they worry could result in their eviction. Even worse is the moratorium preventing landlords from acting on past due rent during the pandemic is soon to end; leaving many people worried about their home. Many are even asking, is it possible to file for bankruptcy and remain in your home even if you are facing eviction?

It is possible to protect yourself from eviction through a bankruptcy filing, but the qualifications for doing so may vary depending on your financial situation. First, it is important to consider a Chapter 13 bankruptcy when dealing with unpaid rent or property payments. While a Chapter 13 bankruptcy can stop an eviction proceeding, it must be filed before the eviction process has started. Second, Chapter 7 bankruptcy is not an option for you if you have a pending eviction proceeding. The reason is that Chapter 7 bankruptcy does not offer you protection from eviction  because it does not allow for the restructuring of debts. This includes the rent payment you may owe your landlord. Chapter 7 bankruptcy also offers no protection from an eviction proceeding and does not cancel a lease. This means that even if you do file for bankruptcy, you will still be liable for the payment of rent until the lease expires.

If you are facing eviction because of unpaid rent, you should consider filing for Chapter 13 bankruptcy. Chapter 13 bankruptcy allows for the restructuring of debts and the payment of rent through a repayment plan based on what you can afford. The repayment period is usually three to five years and requires your landlord to be included in the repayment plan. The most important thing to understand is that you should consult with a bankruptcy attorney if you are considering filing for bankruptcy. A Houston bankruptcy attorney can help you determine if you qualify for Chapter 7 or Chapter 13 bankruptcy and make the right decision for your financial needs.