Right now the Covid-19 pandemic and the state of the economy have worked together to ensure that hundreds of thousands of New York residents are facing the possibility of eviction. There are few things more stressful than knowing you might become homeless while you’re still struggling to replace lost income.
Fortunately, the bankruptcy process can stop eviction in its tracks. Eviction is often a “collection action,” which the automatic stay works to prevent.
Keep in mind if you earn less than 120% of the area’s median income you can apply for the Orange County Eviction Diversion Program.
Here’s what you need to know.
Much Depends on Timing
You should consider filing as soon as you know you may be missing rent payments. If the landlord can get a judgement from the court prior to your filing then they can still evict you unless you pay a month’s rent and certify that you’ll be able to pay all the back rent that you owe.
Since most people who are filing bankruptcy do not have these kinds of resources those who wait too long may find themselves with difficulties.
The Reason for Your Eviction Matters
Bankruptcy will not halt an eviction if you’re being evicted for reasons other than money. For example, if you are being evicted over noise complaints or an unauthorized pet, there is very little that the bankruptcy process can do for you.
The Chapter You Choose Matters
If you’re behind on your rent payments you may not want to file Chapter 7. This is because with a Chapter 7 the presumption is you’re going to move out, since the structure of a Chapter 7 bankruptcy is that all your assets are sold to pay your debts. The only way you would be able to stay in your apartment is if you could pay the back rent.
Chapter 13 allows you to spread out those missed rent payments over time and keeps you in your apartment so long as you maintain rent payments in the future. Of course, Chapter 13 also requires you to have some form of income that you can apply towards your payment plan.
Consult a Bankruptcy Attorney Before Making Any Moves
Every bankruptcy case is different, and every eviction is different. Make sure you have advice from an experienced Orange County, NY bankruptcy attorney before making any decisions. Your current resources, situation, and goals will all play into how we approach your case.
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