Navigating Bankruptcy and Evictions in New York: A Guide

Facing bankruptcy and evictions in New York can feel overwhelming. This guide provides actionable information about bankruptcy and evictions, helping you understand your rights and options. A free consultation with a bankruptcy attorney can help ease your mind during this difficult time.

Understanding Eviction in New York

Evictions in New York City, except for cases between family members (which fall under the Supreme Court), operate within the Housing Court. These are categorized as special proceedings.

Types of Eviction Cases

There are two main types of eviction cases in New York: nonpayment and holdover. A holdover case arises when a landlord claims the tenant’s lease is invalid, perhaps because it expired or has been broken.

A nonpayment case focuses on unpaid rent. Unlike holdovers, nonpayment cases can be settled by paying any owed rental payments. This can include working out a repayment plan.

If your landlord seeks a monetary judgment against you, it could impact your credit report. This could even hurt your chances of getting approved for future housing in New York.

Bankruptcy and Its Impact on Eviction

Bankruptcy, governed by federal law, involves filing a petition and schedules with the bankruptcy court. Filing bankruptcy affects many legal actions, putting an automatic stay on most of them, including some evictions. The automatic stay halts most actions against the debtor and their bankruptcy estate upon filing.

The Automatic Stay and Evictions

This automatic stay, found in Section 362 of the bankruptcy law, offers powerful protection. However, there’s a critical caveat regarding evictions: it generally only applies if filed before a judgment of possession.

If the judgment comes first, the stay won’t halt the eviction process unless specific conditions are met. Appropriate forms must be filed with the bankruptcy petition filed.

Even with a judgment, marshals may avoid carrying out the eviction for fear of violating the stay. This requires landlords to file motions for relief from the stay, giving you more time if you filed bankruptcy. A bankruptcy lawyer can help determine if your case requires a Chapter 7 bankruptcy versus a Chapter 13 bankruptcy filing. Bankruptcy laws can get very complicated. Be sure to seek a free consultation from an attorney to answer questions you have on how the automatic stay stops evictions.

Bankruptcy affects each case uniquely. It is important to consult a legal expert regarding your specific circumstances and understand IRS requirements. A bankruptcy attorney in New York serves clients in navigating these difficult waters.

When dealing with bankruptcy and evictions in New York, timing is critical. Filing bankruptcy before an eviction judgment provides the greatest protection, making it a smart idea for tenants in any eviction proceedings. This can help tenants facing eviction to possibly stay in their homes.

Chapter 7 vs. Chapter 13

Choosing between Chapter 7 and 13 bankruptcy significantly impacts your lease agreement. Under Chapter 7, the bankruptcy trustee decides whether your lease continues. This impacts your ability to keep your apartment and avoid the New York City Housing Court.

Chapter 13 provides more tenant control, enabling them to propose how rent issues will be resolved. A bankruptcy discharge can be used in eviction court as evidence against any rent-related debt you’re discharged from.

A Chapter 13 repayment plan can also include past due and future rent. If you file for bankruptcy before an eviction action goes to court, your case is typically put on hold. Both Chapter 7 and Chapter 13 bankruptcy filing affects each debtor in various ways, including different timetables, financial impacts, and specific rules and procedures regarding what the landlord can do.

Rent-Controlled and Rent-Regulated Apartments

New York’s rent-controlled and rent-regulated apartments add another layer to bankruptcy proceedings. These tenants usually pay lower rent than market value, which could be affected by Chapter 7 bankruptcy. Rent payments often make up the largest amount of expenses in most tenants’ bankruptcy estate.

A Chapter 7 trustee might petition to assign the below market value lease agreement to the bankruptcy estate and make the tenant pay the market value. The landlord may have to file a motion in court if the landlord wants to proceed. The trustee can also petition for a higher rent payment for tenants in rent-stabilized apartments.

Conclusion

Bankruptcy and evictions in New York present complex challenges. Whether your case falls under the New York Civil Court, the New York Supreme Court, or even federal bankruptcy court can be a major factor. Understanding how the filing bankruptcy process can stop an unlawful detainer action from going to trial or possession being ordered prior to petition filed, especially for bankruptcy and evictions in New York, is crucial.

Whether you’re facing mounting debt, potential eviction, lease violations, or both, early action and knowledgeable legal counsel can make a difference. Consult with an experienced bankruptcy and eviction lawyer in New York today. Understanding the laws and the interactions between bankruptcy, lease agreements, and the eviction lawsuit can save your residence, and financial future.

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