Using Bankruptcy To Stop Eviction During The Pandemic

Using Bankruptcy To Stop Eviction During The Pandemic

As the leaders of our government posture their concern for rescuing Americans from an economy devastated by a pandemic where their real attention may be more focused on the November elections, Americans and Utahns will continue to move onward, with or without a new stimulus package. While many protections, including moratoriums on evictions, for renters, have expired, bankruptcy remains a viable option to stop an eviction. Filing bankruptcy may help a person stay in their residence, even if a renter.

The COVID-19 pandemic rages on and many Utah residents have had their hours or wages reduced or have been laid off from or furloughed at their jobs, causing them to have difficulty making rent payments. Now, in addition to the stress that accompanies underemployment and job loss, many people are facing the additional strain of having to move and even becoming homeless.

Tenants who are at risk of eviction must first decide on a course of action to determine what they want to accomplish. This involves deciding if they want to stay at the property and bring the rent current. It also involves whether they want additional time before making the final decision to move out.

If little time remains on the lease’s term, it may be unwise to cure the delinquency since the landlord may refuse to renew the lease and proceed with eviction even if the rent becomes current. If the eviction becomes inevitable and there is no way to obtain alternative housing, filing bankruptcy will stop an eviction.

A tenant may file a Chapter 7 or 13 bankruptcy case to immediately stop the eviction and then resume normal rent payments after filing. While the bankruptcy case is pending, this will allow the debtor to cure the lease arrearages.

Filing a Chapter 7 or 13 bankruptcy case will trigger the automatic stay which acts as a barrier to the collection actions of creditors and stops an eviction. Tenants may then assume or reject the lease during the bankruptcy case. This course of action delays eviction and grants tenants the additional time to make the best decision for them, whether they choose to remain at the property or not. Filing bankruptcy provides additional benefits by discharging other burdensome unsecured debt.

The cost of filing a Chapter 7 bankruptcy case is often less than $2,000, which is an efficient, effective, and economical way to solve burdensome financial problems and gain a fresh start. Theron Morrison and the Morrison Law Group may help any Utah resident better understand their bankruptcy options. Call 801.456.9933 today to schedule a FREE consultation. We have locations in Ogden, Logan, Sandy, and St. George to serve the residents of the counties of Weber, Cache, Salt Lake, Utah, Morgan, Davis, Washington, and surrounding areas.

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Theron Morrison

Utah’s top bankruptcy and consumer protection attorney.