Portland area couple considers their options on unpaid rent debts and filing for bankruptcy

Rent Debt Under Chapter 7 and Chapter 13 Bankruptcy

Here’s a breakdown of what happens with rent debt in Chapter 7 and Chapter 13 bankruptcy:

Chapter 7 Bankruptcy:

  • Your back rent is discharged.
  • The process is quick (usually 3-6 months).
  • You’ll likely have to move out of your place.
  • You get a fresh start faster.

Chapter 13 Bankruptcy:

  • You can include back rent in your repayment plan.
  • The process takes longer (3-5 years).
  • You may be able to stay in your current home.
  • You have more time to catch up on payments.

Can you file for bankruptcy on back rent?

Yes, unpaid rent is considered a debt and is dischargeable in bankruptcy. However, filing bankruptcy does not rehabilitate the lease. You are still in default and can be evicted. You can make up prior missed rent payments through a Chapter 13, but at the end of the lease period, the landlord can still evict you.

Can your landlord evict you if you file for bankruptcy?

No. When you file for bankruptcy, a temporary stay is issued on all debt collection activities, including eviction. You must then immediately resume rent payments, or your landlord can evict you for defaulting after the bankruptcy was filed. A bankruptcy does not prohibit an eviction based on other breaches of the lease, for example, if you are not allowed to have pets and you have a pet, you can still be evicted for that. 

As soon as you know you’re facing eviction, we recommend calling our attorneys to discuss your options. Eviction can be a scary process, especially if you’re in debt and don’t know what your next move should be. In these cases, bankruptcy allows you to retake control of your own immediate and long-term future. 

Can you file for bankruptcy before an eviction?

Yes. Eviction is considered a debt collection activity and cannot proceed until the stay is lifted. If you file for bankruptcy before an eviction notice, your landlord will not be able to begin an eviction without an additional default or permission from the court.

Learn More About Your Options From Our Legal Team

If you’re having trouble keeping your head above water financially and unpaid rent is a big part of the equation, you do have options. Your case is unique, and we can help you navigate your path forward. 

OlsenDaines’ experienced bankruptcy lawyers are here to explain your options and guide you through the process, providing the support and reassurance you need. With our help, you can tackle your rent debt and financial issues. You’ll have a clear plan to move ahead with confidence.

Contact us today for a free consultation, and take the next step toward a debt-free future.

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