Bankruptcy And Evictions
Of all the bills that can pile up and land you in debt, one of the most stressful scenarios is undoubtedly realizing you have fallen far behind on the home you rent. And unfortunately, this has been one of the ongoing stressors of the COVID-19 pandemic for many Americans. A survey published in March by the Census Bureau indicates that approximately 20 percent of adult renters asked this past February self-reported not having paid the prior month’s rent. Other statistics indicate that almost 48,000 evictions were filed in Florida just during the 2020 pandemic months. Suffering from the kind of financial problems that leads to not being able to pay rent unfortunately also means that renters in this situation typically have other substantial debt that they need a way out of. Bankruptcy may be the solution.
How Bankruptcy May Help
With nationwide moratoriums on rent coming to an end at the end of June and placing the housing status of upwards of 11 million Americans who are behind on their rent in jeopardy, renters who have been struggling to pay rent are likely wondering how their financial future is going to be impacted. Despite the grimness of this situation, know that in a worst case scenario, even an eviction on your record doesn’t mean you’ll never be approved to rent another property and doesn’t mean that hope for a more financially stable housing solution should be lost, especially if you are considering bankruptcy.
Filing for bankruptcy initiates a process called the automatic stay which stops most collection actions. While there are some exceptions, for the most part, the automatic stay prevents creditors from attempting to collect a debt from the debtor, including eviction lawsuits if they haven’t proceeded too far. Even if you are in an imminent eviction process that can’t be halted, filing for bankruptcy results in either a discharge where you’re no longer obligated to repay what you owe or a more manageable repayment plan that may allow you to stay in your home and catch up on your rent in the process. Either way, you can end up in a much better position in the future and filing for bankruptcy might be able to help you prevent or delay the eviction in the first place.
Tips for Finding New Housing
Even if your debt is discharged in bankruptcy, that doesn’t necessarily mean the eviction won’t be on your credit if you have one. If you have an eviction on your credit report, you should know your landlord may agree to have your record expunged if you pay all outstanding debts. Regardless of whether that person agrees to those kinds of terms, you can also improve your housing options by:
- Continuing to work on improving your credit score
- Applying for individually-owned properties whose owners are more likely to give you a chance
- If possible, waiting seven years to relocate until the eviction on your credit falls off naturally
Are You Worried About Bankruptcy and Evictions?
If you are a tenant and are considering filing for bankruptcy, talking to an experienced legal team prior to undertaking any further steps is something you should strongly consider and likely do. With the help of the right legal counsel, you may be able to clear your rental debts and find yourself in a much better future financial situation. As the Plantation bankruptcy attorneys at Nowack & Olson, PLLC, we can support you throughout the eviction and bankruptcy process. Whether you’d simply like to discuss your situation or you are ready to move forward with your bankruptcy case, contact us today for a free consultation.