Can Bankruptcy Stop an Eviction?
A bankruptcy filing affects many aspects of your financial life by providing an automatic stay on debts when you file. This stay may affect the eviction process, depending on how far you are into the process.
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A bankruptcy filing will not prevent a landlord from evicting a tenant if he has already gone through the eviction process and has been awarded the eviction judgment. Filing anytime before the final judgment in the eviction case does stop eviction litigation through the automatic stay granted by bankruptcy. The length of time that the automatic stay is in effect depends on how soon the bankruptcy court answers the landlord's petition.
Effects
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An automatic stay prevents the landlord from sending a tenant a termination notice for nonpayment of rent prior to the eviction starting. The tenant is not absolved of all rent obligations under the stay, however. The tenant must pay current rent payments incurred after the bankruptcy filing, as this debt is not covered under the automatic stay.
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Recourse
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The landlord must request that the stay be lifted before the eviction case can move forward. He files a motion in the bankruptcy court to remove the stay from the rental debts. The landlord attends a court hearing in the bankruptcy court to see if the motion is granted.
Remedy
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Since the landlord typically does not know when a tenant is going to file for bankruptcy, he does not have a guaranteed way to avoid the effects of a bankruptcy on an eviction case.
Misconceptions
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Prior to the implementation of the Bankruptcy Abuse Prevention Consumer Protection Act, tenants could use a bankruptcy filing to stop an eviction even after judgment is granted. After this act was passed in 2005, a tenant would still be evicted if the landlord has a judgment of possession ruling against the tenant.
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