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If you’re filing for personal bankruptcy, the bankruptcy code provides two main options: Chapter 7 and Chapter 13. If you want a “straight” bankruptcy wherein you allow the bankruptcy court to liquidate your assets in order to pay back your creditors, the bankruptcy chapter for you is Chapter 7, also known as liquidation bankruptcy.
Going through this bankruptcy process allows you to pursue debt relief by eliminating almost all of your debts after your bankruptcy trustee sells some of your personal property and uses the proceeds to pay off one creditor after another.
How Can a Chapter 7 Bankruptcy Help You?
The following are the most known benefits of declaring bankruptcy under Chapter 7:
- A Way out of Debt
Federal bankruptcy law regulates bankruptcy proceedings, which in Chapter 7 bankruptcy cases result in the virtual elimination of unsecured debt. Unsecured debts are those that do not have collateral attached to them, e.g. store charge card or credit card debt, medical bills, and personal loans.
- Bankruptcy Protection
Filing bankruptcy triggers the automatic stay, which effectively halts the collection efforts of creditors, collection agencies, and other debt collectors. All attempts to collect the debt, from phone calls and letters to wage garnishment and mortgage liens, must be stopped. This gives a debtor some breathing space while he or she works out her financial problems and plans for a better financial future.
- Credit Negotiation Tool
Bankruptcies have a way of softening the stance of unbending creditors. A debt collector is more willing to negotiate and strike a deal in the face of an impending bankruptcy discharge and the possibility of ending up with nothing. This kind of negotiation, however, can get tricky, so it is best handled by an experienced bankruptcy attorney.
How Can a Bankruptcy Lawyer Help You?
While engaging the services of a lawyer is not required, bankruptcy filers are encouraged to hire legal help so they can be advised and guided on their bankruptcy filing toward the best possible results. An attorney who specializes in bankruptcy law can help a bankrupt client make informed decisions throughout the process.
How can you benefit from getting legal assistance?
- You can better understand the different bankruptcy options and how the means test works so that you can have an idea of what assets you could lose and how the bankruptcy petition could turn out for you.
- You can be guided on how to file for bankruptcy properly, by filling out bankruptcy forms and collecting accompanying documents so that you avoid unfortunate mistakes.
- You can be counseled on the different bankruptcy exemptions available to you so that you end up choosing which ones best suit your bankruptcy case.
- You can count on support and representation throughout your bankruptcy journey.
Considering a Chapter 7 Bankruptcy? Contact a Texas Bankruptcy Attorney Today!
The decision to declare bankruptcy is a serious one. Let us advise you on the best solutions to your situation and help you take action. Call us at Allmand Law Firm, PLLC to speak with a skilled and experienced bankruptcy lawyer about your case.
The post Texas Bankruptcy – Chapter 7 Cases appeared first on Allmand Law Firm, PLLC.
If you’re filing for personal bankruptcy, the bankruptcy code provides two main options: Chapter 7 and Chapter 13. If you want a “straight” bankruptcy wherein you allow the bankruptcy court to liquidate your assets in order to pay back your creditors, the bankruptcy chapter for you is Chapter 7, also known as liquidation bankruptcy.
Going through this bankruptcy process allows you to pursue debt relief by eliminating almost all of your debts after your bankruptcy trustee sells some of your personal property and uses the proceeds to pay off one creditor after another.
How Can a Chapter 7 Bankruptcy Help You?
The following are the most known benefits of declaring bankruptcy under Chapter 7:
- A Way out of Debt
Federal bankruptcy law regulates bankruptcy proceedings, which in Chapter 7 bankruptcy cases result in the virtual elimination of unsecured debt. Unsecured debts are those that do not have collateral attached to them, e.g. store charge card or credit card debt, medical bills, and personal loans.
- Bankruptcy Protection
Filing bankruptcy triggers the automatic stay, which effectively halts the collection efforts of creditors, collection agencies, and other debt collectors. All attempts to collect the debt, from phone calls and letters to wage garnishment and mortgage liens, must be stopped. This gives a debtor some breathing space while he or she works out her financial problems and plans for a better financial future.
- Credit Negotiation Tool
Bankruptcies have a way of softening the stance of unbending creditors. A debt collector is more willing to negotiate and strike a deal in the face of an impending bankruptcy discharge and the possibility of ending up with nothing. This kind of negotiation, however, can get tricky, so it is best handled by an experienced bankruptcy attorney.
How Can a Bankruptcy Lawyer Help You?
While engaging the services of a lawyer is not required, bankruptcy filers are encouraged to hire legal help so they can be advised and guided on their bankruptcy filing toward the best possible results. An attorney who specializes in bankruptcy law can help a bankrupt client make informed decisions throughout the process.
How can you benefit from getting legal assistance?
- You can better understand the different bankruptcy options and how the means test works so that you can have an idea of what assets you could lose and how the bankruptcy petition could turn out for you.
- You can be guided on how to file for bankruptcy properly, by filling out bankruptcy forms and collecting accompanying documents so that you avoid unfortunate mistakes.
- You can be counseled on the different bankruptcy exemptions available to you so that you end up choosing which ones best suit your bankruptcy case.
- You can count on support and representation throughout your bankruptcy journey.
Considering a Chapter 7 Bankruptcy? Contact a Texas Bankruptcy Attorney Today!
The decision to declare bankruptcy is a serious one. Let us advise you on the best solutions to your situation and help you take action. Call us at Allmand Law Firm, PLLC to speak with a skilled and experienced bankruptcy lawyer about your case.
The post Texas Bankruptcy – Chapter 7 Cases appeared first on Allmand Law Firm, PLLC.
If you’re filing for personal bankruptcy, the bankruptcy code provides two main options: Chapter 7 and Chapter 13. If you want a “straight” bankruptcy wherein you allow the bankruptcy court to liquidate your assets in order to pay back your creditors, the bankruptcy chapter for you is Chapter 7, also known as liquidation bankruptcy.
Going through this bankruptcy process allows you to pursue debt relief by eliminating almost all of your debts after your bankruptcy trustee sells some of your personal property and uses the proceeds to pay off one creditor after another.
How Can a Chapter 7 Bankruptcy Help You?
The following are the most known benefits of declaring bankruptcy under Chapter 7:
- A Way out of Debt
Federal bankruptcy law regulates bankruptcy proceedings, which in Chapter 7 bankruptcy cases result in the virtual elimination of unsecured debt. Unsecured debts are those that do not have collateral attached to them, e.g. store charge card or credit card debt, medical bills, and personal loans.
- Bankruptcy Protection
Filing bankruptcy triggers the automatic stay, which effectively halts the collection efforts of creditors, collection agencies, and other debt collectors. All attempts to collect the debt, from phone calls and letters to wage garnishment and mortgage liens, must be stopped. This gives a debtor some breathing space while he or she works out her financial problems and plans for a better financial future.
- Credit Negotiation Tool
Bankruptcies have a way of softening the stance of unbending creditors. A debt collector is more willing to negotiate and strike a deal in the face of an impending bankruptcy discharge and the possibility of ending up with nothing. This kind of negotiation, however, can get tricky, so it is best handled by an experienced bankruptcy attorney.
How Can a Bankruptcy Lawyer Help You?
While engaging the services of a lawyer is not required, bankruptcy filers are encouraged to hire legal help so they can be advised and guided on their bankruptcy filing toward the best possible results. An attorney who specializes in bankruptcy law can help a bankrupt client make informed decisions throughout the process.
How can you benefit from getting legal assistance?
- You can better understand the different bankruptcy options and how the means test works so that you can have an idea of what assets you could lose and how the bankruptcy petition could turn out for you.
- You can be guided on how to file for bankruptcy properly, by filling out bankruptcy forms and collecting accompanying documents so that you avoid unfortunate mistakes.
- You can be counseled on the different bankruptcy exemptions available to you so that you end up choosing which ones best suit your bankruptcy case.
- You can count on support and representation throughout your bankruptcy journey.
Considering a Chapter 7 Bankruptcy? Contact a Texas Bankruptcy Attorney Today!
The decision to declare bankruptcy is a serious one. Let us advise you on the best solutions to your situation and help you take action. Call us at Allmand Law Firm, PLLC to speak with a skilled and experienced bankruptcy lawyer about your case.
The post Texas Bankruptcy – Chapter 7 Cases appeared first on Allmand Law Firm, PLLC.
If you’re filing for personal bankruptcy, the bankruptcy code provides two main options: Chapter 7 and Chapter 13. If you want a “straight” bankruptcy wherein you allow the bankruptcy court to liquidate your assets in order to pay back your creditors, the bankruptcy chapter for you is Chapter 7, also known as liquidation bankruptcy.
Going through this bankruptcy process allows you to pursue debt relief by eliminating almost all of your debts after your bankruptcy trustee sells some of your personal property and uses the proceeds to pay off one creditor after another.
How Can a Chapter 7 Bankruptcy Help You?
The following are the most known benefits of declaring bankruptcy under Chapter 7:
- A Way out of Debt
Federal bankruptcy law regulates bankruptcy proceedings, which in Chapter 7 bankruptcy cases result in the virtual elimination of unsecured debt. Unsecured debts are those that do not have collateral attached to them, e.g. store charge card or credit card debt, medical bills, and personal loans.
- Bankruptcy Protection
Filing bankruptcy triggers the automatic stay, which effectively halts the collection efforts of creditors, collection agencies, and other debt collectors. All attempts to collect the debt, from phone calls and letters to wage garnishment and mortgage liens, must be stopped. This gives a debtor some breathing space while he or she works out her financial problems and plans for a better financial future.
- Credit Negotiation Tool
Bankruptcies have a way of softening the stance of unbending creditors. A debt collector is more willing to negotiate and strike a deal in the face of an impending bankruptcy discharge and the possibility of ending up with nothing. This kind of negotiation, however, can get tricky, so it is best handled by an experienced bankruptcy attorney.
How Can a Bankruptcy Lawyer Help You?
While engaging the services of a lawyer is not required, bankruptcy filers are encouraged to hire legal help so they can be advised and guided on their bankruptcy filing toward the best possible results. An attorney who specializes in bankruptcy law can help a bankrupt client make informed decisions throughout the process.
How can you benefit from getting legal assistance?
- You can better understand the different bankruptcy options and how the means test works so that you can have an idea of what assets you could lose and how the bankruptcy petition could turn out for you.
- You can be guided on how to file for bankruptcy properly, by filling out bankruptcy forms and collecting accompanying documents so that you avoid unfortunate mistakes.
- You can be counseled on the different bankruptcy exemptions available to you so that you end up choosing which ones best suit your bankruptcy case.
- You can count on support and representation throughout your bankruptcy journey.
Considering a Chapter 7 Bankruptcy? Contact a Texas Bankruptcy Attorney Today!
The decision to declare bankruptcy is a serious one. Let us advise you on the best solutions to your situation and help you take action. Call us at Allmand Law Firm, PLLC to speak with a skilled and experienced bankruptcy lawyer about your case.
The post Texas Bankruptcy – Chapter 7 Cases appeared first on Allmand Law Firm, PLLC.
Things have not been so great for a lot of Texans this year. To put it mildly, there has been a lot of doom and gloom spreading across our airwaves since the middle of March. If you have listened to the radio, a current events podcast, or watched the news at all (and we understand if you have tried to stay away), you know that a major topic that has been discussed at length recently is the deadlock between our government leaders in Washington over the creation of new legislation that will extend certain benefits and provide needed resources to businesses and individuals all across America. Sadly, it appears that progress has been stifled by deeply held convictions over what kind of support is needed, how much should be given, and of course, to whom. As we continue to struggle in our fight to contain the spread of the novel Coronavirus that causes COVID-19, one thing is clear: the world is continuing to move forward, with or without a new stimulus package, and businesses and people in Texas and all across the country are struggling to stay afloat.
Much of the media discussion has focused on the expiration of the Cares Act, which officially ended last week and the ramifications that its conclusion will have for people who are currently receiving unemployment funds (with the $600 bonus included). But it wasn’t only the additional unemployment benefits that expired when the first stimulus program ended. Many protections for renters are also expiring or have expired, and moratoriums on evictions that have been in place since the beginning of the COVID-19 pandemic started to expire as well. This has created a serious problem for Texans who are out of work, have had their hours or wages slashed, or have been furloughed at their jobs, and are having difficulty paying the rent.
With all the stresses that go with job loss and underemployment, many are now facing the additional threat of having to move and/or the potential of homelessness as well. In these dire times of uncertainty, and with the ever-present threat of a continuing and escalating global pandemic upon us, what is the best option for tenants who need a place to live, and for the landlords who still need to collect rent and earn income on their properties?
In a word, the best and first step is always communication.
.fusion-body .fusion-builder-column-0{width:66.666666666667% !important;margin-top : 0px;margin-bottom : 0px;}.fusion-builder-column-0 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 3.84%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 2.88%;}@media only screen and (max-width:1024px) {.fusion-body .fusion-builder-column-0{width:66.666666666667% !important;}.fusion-builder-column-0 > .fusion-column-wrapper {margin-right : 3.84%;margin-left : 2.88%;}}@media only screen and (max-width:850px) {.fusion-body .fusion-builder-column-0{width:100% !important;}.fusion-builder-column-0 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}
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Before you jump headfirst into that mandatory conversation with your landlord, you need to take a moment to breathe, collect your thoughts, and come up with a plan. Just like coaches prepare before a football game, and business owners prepare for a big presentation, you as an at-risk tenant need to first decide on a game plan and determine what you want to achieve.
For example:
- Do you want to stay in the property and bring the rent current?
- Do you want additional time before you decide whether or not to move out?
- Are you ready to move out now, but just need some extra time to move to find another place?
Let’s look at scenario one first. If the goal is to stay in the property and bring the rent current, then you need to consider a few factors, including how much additional time you have remaining on the lease. If you do not have much time left on the lease, then it might not be in your best interest to spend every last dime to catch up on the delinquency, because the landlord can always refuse to renew the lease and proceed with eviction even if the rent current. The following are strategies to accomplish this goal:
- Negotiate directly with the Landlord for additional time. The more money you have to put down and the sooner you can catch up on the rent, the more likely an agreement can be reached. However, make sure you get the agreement in writing, because there have been many stories reported where the Landlord made a verbal agreement not to proceed with the eviction and accepted partial payment, but then continued with the eviction anyway.
- Filing a Chapter 7 or 11 bankruptcy case to immediately stop the eviction and resume normal payments after filing. The bankruptcy will allow the individual to cure the lease arrears before filing by making monthly bankruptcy payments. Most bankruptcy law firms offer free consultations. Allmand Law Firm offers free virtual consultations and filings across the state of Texas.
Second, if your goal is to get additional time to determine whether you will need to move out, then you can do the following:
- Negotiate with the Landlord for additional time, but be sure to get it in writing.
- If an eviction notice has already been served, you can contest the eviction by filing a response, raising a statutory defense, and requesting discovery to verify compliance with Cares Act. Also, if an eviction order has already been entered, you can file an appeal of the order, which can buy you and your family additional time in the property while the appeal is heard.
- If an eviction notice hasn’t been served, filing Chapter 7 or 11 bankruptcy will impose an automatic stay to prevent an eviction. Tenants can then reject the lease discharge, the lease arrears, and any additional unsecured debt. This strategy delays the evictions, grants you additional time in the property, and has the added benefits that accompany other bankruptcy filings: the ability to unload your burdensome credit card and other unsecured debt.
For the final option, even if you are willing to move out, then you should try to negotiate an agreement with your landlord commonly referred to as “Cash for Keys”. This is when the landlord will agree to make a nominal payment to the tenant to encourage them to move out, rather than going through the time and legal expense of filing for a formal eviction. The process for filing evictions costs landlords time, money, and is generally a headache they would rather not deal with. Done correctly, you can often negotiate with them by offering to save them the hassle and expense of filing an eviction notice by simply giving you a small cash incentive that you will use to expedite your departure.
more info. on Cash-For-Keys arrangements: www.rentprep.com/evictions/cash-for-keys
.fusion-body .fusion-builder-column-2{width:100% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-column-2 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1024px) {.fusion-body .fusion-builder-column-2{width:100% !important;order : 0;}.fusion-builder-column-2 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:850px) {.fusion-body .fusion-builder-column-2{width:100% !important;order : 0;}.fusion-builder-column-2 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}.fusion-body .fusion-flex-container.fusion-builder-row-2{ padding-top : 0px;margin-top : 0px;padding-right : 0px;padding-bottom : 0px;margin-bottom : 0px;padding-left : 0px;}
The post How should you negotiate with a landlord when facing evictions? appeared first on Allmand Law Firm, PLLC.
Things have not been so great for a lot of Texans this year. To put it mildly, there has been a lot of doom and gloom spreading across our airwaves since the middle of March. If you have listened to the radio, a current events podcast, or watched the news at all (and we understand if you have tried to stay away), you know that a major topic that has been discussed at length recently is the deadlock between our government leaders in Washington over the creation of new legislation that will extend certain benefits and provide needed resources to businesses and individuals all across America. Sadly, it appears that progress has been stifled by deeply held convictions over what kind of support is needed, how much should be given, and of course, to whom. As we continue to struggle in our fight to contain the spread of the novel Coronavirus that causes COVID-19, one thing is clear: the world is continuing to move forward, with or without a new stimulus package, and businesses and people in Texas and all across the country are struggling to stay afloat.
Much of the media discussion has focused on the expiration of the Cares Act, which officially ended last week and the ramifications that its conclusion will have for people who are currently receiving unemployment funds (with the $600 bonus included). But it wasn’t only the additional unemployment benefits that expired when the first stimulus program ended. Many protections for renters are also expiring or have expired, and moratoriums on evictions that have been in place since the beginning of the COVID-19 pandemic started to expire as well. This has created a serious problem for Texans who are out of work, have had their hours or wages slashed, or have been furloughed at their jobs, and are having difficulty paying the rent.
With all the stresses that go with job loss and underemployment, many are now facing the additional threat of having to move and/or the potential of homelessness as well. In these dire times of uncertainty, and with the ever-present threat of a continuing and escalating global pandemic upon us, what is the best option for tenants who need a place to live, and for the landlords who still need to collect rent and earn income on their properties?
In a word, the best and first step is always communication.
.fusion-body .fusion-builder-column-0{width:66.666666666667% !important;margin-top : 0px;margin-bottom : 0px;}.fusion-builder-column-0 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 3.84%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 2.88%;}@media only screen and (max-width:1024px) {.fusion-body .fusion-builder-column-0{width:66.666666666667% !important;}.fusion-builder-column-0 > .fusion-column-wrapper {margin-right : 3.84%;margin-left : 2.88%;}}@media only screen and (max-width:850px) {.fusion-body .fusion-builder-column-0{width:100% !important;}.fusion-builder-column-0 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}
.fusion-body .fusion-builder-column-1{width:33.333333333333% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-column-1 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 5.76%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 3.84%;}@media only screen and (max-width:1024px) {.fusion-body .fusion-builder-column-1{width:33.333333333333% !important;order : 0;}.fusion-builder-column-1 > .fusion-column-wrapper {margin-right : 5.76%;margin-left : 3.84%;}}@media only screen and (max-width:850px) {.fusion-body .fusion-builder-column-1{width:100% !important;order : 0;}.fusion-builder-column-1 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}.fusion-body .fusion-flex-container.fusion-builder-row-1{ padding-top : 0px;margin-top : 0px;padding-right : 0px;padding-bottom : 0px;margin-bottom : 0px;padding-left : 0px;}
Before you jump headfirst into that mandatory conversation with your landlord, you need to take a moment to breathe, collect your thoughts, and come up with a plan. Just like coaches prepare before a football game, and business owners prepare for a big presentation, you as an at-risk tenant need to first decide on a game plan and determine what you want to achieve.
For example:
- Do you want to stay in the property and bring the rent current?
- Do you want additional time before you decide whether or not to move out?
- Are you ready to move out now, but just need some extra time to move to find another place?
Let’s look at scenario one first. If the goal is to stay in the property and bring the rent current, then you need to consider a few factors, including how much additional time you have remaining on the lease. If you do not have much time left on the lease, then it might not be in your best interest to spend every last dime to catch up on the delinquency, because the landlord can always refuse to renew the lease and proceed with eviction even if the rent current. The following are strategies to accomplish this goal:
- Negotiate directly with the Landlord for additional time. The more money you have to put down and the sooner you can catch up on the rent, the more likely an agreement can be reached. However, make sure you get the agreement in writing, because there have been many stories reported where the Landlord made a verbal agreement not to proceed with the eviction and accepted partial payment, but then continued with the eviction anyway.
- Filing a Chapter 7 or 13 bankruptcy case to immediately stop the eviction and resume normal payments after filing. The bankruptcy will allow the individual to cure the lease arrears before filing by making monthly bankruptcy payments. Most bankruptcy law firms offer free consultations. Allmand Law Firm offers free virtual consultations and filings across the state of Texas.
Second, if your goal is to get additional time to determine whether you will need to move out, then you can do the following:
- Negotiate with the Landlord for additional time, but be sure to get it in writing.
- If an eviction notice has already been served, you can contest the eviction by filing a response, raising a statutory defense, and requesting discovery to verify compliance with Cares Act. Also, if an eviction order has already been entered, you can file an appeal of the order, which can buy you and your family additional time in the property while the appeal is heard.
- If an eviction notice hasn’t been served, filing Chapter 7 or 13 bankruptcy will impose an automatic stay to prevent an eviction. Tenants can then reject the lease discharge, the lease arrears, and any additional unsecured debt. This strategy delays the evictions, grants you additional time in the property, and has the added benefits that accompany other bankruptcy filings: the ability to unload your burdensome credit card and other unsecured debt.
For the final option, even if you are willing to move out, then you should try to negotiate an agreement with your landlord commonly referred to as “Cash for Keys”. This is when the landlord will agree to make a nominal payment to the tenant to encourage them to move out, rather than going through the time and legal expense of filing for a formal eviction. The process for filing evictions costs landlords time, money, and is generally a headache they would rather not deal with. Done correctly, you can often negotiate with them by offering to save them the hassle and expense of filing an eviction notice by simply giving you a small cash incentive that you will use to expedite your departure.
more info on Cash-For-Keys arrangements: www.rentprep.com/evictions/cash-for-keys
.fusion-body .fusion-builder-column-2{width:100% !important;margin-top : 0px;margin-bottom : 20px;}.fusion-builder-column-2 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 1.92%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 1.92%;}@media only screen and (max-width:1024px) {.fusion-body .fusion-builder-column-2{width:100% !important;order : 0;}.fusion-builder-column-2 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}@media only screen and (max-width:850px) {.fusion-body .fusion-builder-column-2{width:100% !important;order : 0;}.fusion-builder-column-2 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}.fusion-body .fusion-flex-container.fusion-builder-row-2{ padding-top : 0px;margin-top : 0px;padding-right : 0px;padding-bottom : 0px;margin-bottom : 0px;padding-left : 0px;}
The post How should you negotiate with a landlord when facing evictions? appeared first on Allmand Law Firm, PLLC.
Things have not been so great for a lot of Texans this year. To put it mildly, there has been a lot of doom and gloom spreading across our airwaves since the middle of March. If you have listened to the radio, a current events podcast, or watched the news at all (and we understand if you have tried to stay away), you know that a major topic that has been discussed at length recently is the deadlock between our government leaders in Washington over the creation of new legislation that will extend certain benefits and provide needed resources to businesses and individuals all across America. Sadly, it appears that progress has been stifled by deeply held convictions over what kind of support is needed, how much should be given, and of course, to whom. As we continue to struggle in our fight to contain the spread of the novel Coronavirus that causes COVID-19, one thing is clear: the world is continuing to move forward, with or without a new stimulus package, and businesses and people in Texas and all across the country are struggling to stay afloat.
Much of the media discussion has focused on the expiration of the Cares Act, which officially ended last week and the ramifications that its conclusion will have for people who are currently receiving unemployment funds (with the $600 bonus included). But it wasn’t only the additional unemployment benefits that expired when the first stimulus program ended. Many protections for renters are also expiring or have expired, and moratoriums on evictions that have been in place since the beginning of the COVID-19 pandemic started to expire as well. This has created a serious problem for Texans who are out of work, have had their hours or wages slashed, or have been furloughed at their jobs, and are having difficulty paying the rent.
With all the stresses that go with job loss and underemployment, many are now facing the additional threat of having to move and/or the potential of homelessness as well. In these dire times of uncertainty, and with the ever-present threat of a continuing and escalating global pandemic upon us, what is the best option for tenants who need a place to live, and for the landlords who still need to collect rent and earn income on their properties?
In a word, the best and first step is always communication.
.fusion-body .fusion-builder-column-0{width:66.6666666667% !important;margin-top : 0px;margin-bottom : 0px;}.fusion-builder-column-0 > .fusion-column-wrapper {padding-top : 0px !important;padding-right : 0px !important;margin-right : 3.84%;padding-bottom : 0px !important;padding-left : 0px !important;margin-left : 2.88%;}@media only screen and (max-width:1024px) {.fusion-body .fusion-builder-column-0{width:66.6666666667% !important;}.fusion-builder-column-0 > .fusion-column-wrapper {margin-right : 3.84%;margin-left : 2.88%;}}@media only screen and (max-width:850px) {.fusion-body .fusion-builder-column-0{width:100% !important;}.fusion-builder-column-0 > .fusion-column-wrapper {margin-right : 1.92%;margin-left : 1.92%;}}
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Before you jump headfirst into that mandatory conversation with your landlord, you need to take a moment to breathe, collect your thoughts, and come up with a plan. Just like coaches prepare before a football game, and business owners prepare for a big presentation, you as an at-risk tenant need to first decide on a game plan and determine what you want to achieve.
For example:
- Do you want to stay in the property and bring the rent current?
- Do you want additional time before you decide whether or not to move out?
- Are you ready to move out now, but just need some extra time to move to find another place?
Let’s look at scenario one first. If the goal is to stay in the property and bring the rent current, then you need to consider a few factors, including how much additional time you have remaining on the lease. If you do not have much time left on the lease, then it might not be in your best interest to spend every last dime to catch up on the delinquency, because the landlord can always refuse to renew the lease and proceed with eviction even if the rent current. The following are strategies to accomplish this goal:
- Negotiate directly with the Landlord for additional time. The more money you have to put down and the sooner you can catch up on the rent, the more likely an agreement can be reached. However, make sure you get the agreement in writing, because there have been many stories reported where the Landlord made a verbal agreement not to proceed with the eviction and accepted partial payment, but then continued with the eviction anyway.
- Filing a Chapter 7 or 13 bankruptcy case to immediately stop the eviction and resume normal payments after filing. The bankruptcy will allow the individual to cure the lease arrears before filing by making monthly bankruptcy payments. Most bankruptcy law firms offer free consultations. Allmand Law Firm offers free virtual consultations and filings across the state of Texas.
Second, if your goal is to get additional time to determine whether you will need to move out, then you can do the following:
- Negotiate with the Landlord for additional time, but be sure to get it in writing.
- If an eviction notice has already been served, you can contest the eviction by filing a response, raising a statutory defense, and requesting discovery to verify compliance with Cares Act. Also, if an eviction order has already been entered, you can file an appeal of the order, which can buy you and your family additional time in the property while the appeal is heard.
- If an eviction notice hasn’t been served, filing Chapter 7 or 13 bankruptcy will impose an automatic stay to prevent an eviction. Tenants can then reject the lease discharge, the lease arrears, and any additional unsecured debt. This strategy delays the evictions, grants you additional time in the property, and has the added benefits that accompany other bankruptcy filings: the ability to unload your burdensome credit card and other unsecured debt.
For the final option, even if you are willing to move out, then you should try to negotiate an agreement with your landlord commonly referred to as “Cash for Keys”. This is when the landlord will agree to make a nominal payment to the tenant to encourage them to move out, rather than going through the time and legal expense of filing for a formal eviction. The process for filing evictions costs landlords time, money, and is generally a headache they would rather not deal with. Done correctly, you can often negotiate with them by offering to save them the hassle and expense of filing an eviction notice by simply giving you a small cash incentive that you will use to expedite your departure.
more info on Cash-For-Keys arrangements: www.rentprep.com/evictions/cash-for-keys
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Things have not been so great for a lot of Texans this year. To put it mildly, there has been a lot of doom and gloom spreading across our airwaves since the middle of March. If you have listened to the radio, a current events podcast, or watched the news at all (and we understand if you have tried to stay away), you know that a major topic that has been discussed at length recently is the deadlock between our government leaders in Washington over the creation of new legislation that will extend certain benefits and provide needed resources to businesses and individuals all across America. Sadly, it appears that progress has been stifled by deeply held convictions over what kind of support is needed, how much should be given, and of course, to whom. As we continue to struggle in our fight to contain the spread of the novel Coronavirus that causes COVID-19, one thing is clear: the world is continuing to move forward, with or without a new stimulus package, and businesses and people in Texas and all across the country are struggling to stay afloat.
Much of the media discussion has focused on the expiration of the Cares Act, which officially ended last week and the ramifications that its conclusion will have for people who are currently receiving unemployment funds (with the $600 bonus included). But it wasn’t only the additional unemployment benefits that expired when the first stimulus program ended. Many protections for renters are also expiring or have expired, and moratoriums on evictions that have been in place since the beginning of the COVID-19 pandemic started to expire as well. This has created a serious problem for Texans who are out of work, have had their hours or wages slashed, or have been furloughed at their jobs, and are having difficulty paying the rent.
With all the stresses that go with job loss and underemployment, many are now facing the additional threat of having to move and/or the potential of homelessness as well. In these dire times of uncertainty, and with the ever-present threat of a continuing and escalating global pandemic upon us, what is the best option for tenants who need a place to live, and for the landlords who still need to collect rent and earn income on their properties?
In a word, the best and first step is always communication.
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Before you jump headfirst into that mandatory conversation with your landlord, you need to take a moment to breathe, collect your thoughts, and come up with a plan. Just like coaches prepare before a football game, and business owners prepare for a big presentation, you as an at-risk tenant need to first decide on a game plan and determine what you want to achieve.
For example:
- Do you want to stay in the property and bring the rent current?
- Do you want additional time before you decide whether or not to move out?
- Are you ready to move out now, but just need some extra time to move to find another place?
Let’s look at scenario one first. If the goal is to stay in the property and bring the rent current, then you need to consider a few factors, including how much additional time you have remaining on the lease. If you do not have much time left on the lease, then it might not be in your best interest to spend every last dime to catch up on the delinquency, because the landlord can always refuse to renew the lease and proceed with eviction even if the rent current. The following are strategies to accomplish this goal:
- Negotiate directly with the Landlord for additional time. The more money you have to put down and the sooner you can catch up on the rent, the more likely an agreement can be reached. However, make sure you get the agreement in writing, because there have been many stories reported where the Landlord made a verbal agreement not to proceed with the eviction and accepted partial payment, but then continued with the eviction anyway.
- Filing a Chapter 7 or 13 bankruptcy case to immediately stop the eviction and resume normal payments after filing. The bankruptcy will allow the individual to cure the lease arrears before filing by making monthly bankruptcy payments. Most bankruptcy law firms offer free consultations. Allmand Law Firm offers free virtual consultations and filings across the state of Texas.
Second, if your goal is to get additional time to determine whether you will need to move out, then you can do the following:
- Negotiate with the Landlord for additional time, but be sure to get it in writing.
- If an eviction notice has already been served, you can contest the eviction by filing a response, raising a statutory defense, and requesting discovery to verify compliance with Cares Act. Also, if an eviction order has already been entered, you can file an appeal of the order, which can buy you and your family additional time in the property while the appeal is heard.
- If an eviction notice hasn’t been served, filing Chapter 7 or 13 bankruptcy will impose an automatic stay to prevent an eviction. Tenants can then reject the lease discharge, the lease arrears, and any additional unsecured debt. This strategy delays the evictions, grants you additional time in the property, and has the added benefits that accompany other bankruptcy filings: the ability to unload your burdensome credit card and other unsecured debt.
For the final option, even if you are willing to move out, then you should try to negotiate an agreement with your landlord commonly referred to as “Cash for Keys”. This is when the landlord will agree to make a nominal payment to the tenant to encourage them to move out, rather than going through the time and legal expense of filing for a formal eviction. The process for filing evictions costs landlords time, money, and is generally a headache they would rather not deal with. Done correctly, you can often negotiate with them by offering to save them the hassle and expense of filing an eviction notice by simply giving you a small cash incentive that you will use to expedite your departure.
more info on Cash-For-Keys arrangements: www.rentprep.com/evictions/cash-for-keys
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As many readers of our blog and emails, Congress passed a new bankruptcy law known as Subchapter V. Information about that law can be found at our blog shenwick.blogspot.com. https://shenwick.blogspot.com/2020/06/how-subchapter-v-could-save-your-small.htmlNew Subchapter V is similar to chapter 13 of the bankruptcy code but it can only be used by a business, not an individual.Some creative uses of Subchapter V are to discharge repayment of a PPP loan, to reject a commercial lease which a tenant no longer wants to occupy, or to reject unfavorable agreements. Subchapter V became effective on February 19, 2020 and several decisions have been announced by various bankruptcy courts which are favorable to Debtors. First, if a company filed bankruptcy under Chapter 11 can they convert their case to a case under Subchapter V? Yes. In re Progressive Solutions, Inc., No. 8:18-bk-14277-SC, 2020 WL 975464, at *5 (Bankr. C.D. Cal. February 21, 2020) (small business designated Chapter 11 debtor could retroactively proceed under Subchapter V after the case had been pending approximately 15 months).
-In re Glass Contractors, Inc., No. 20-40185 (Bankr. E.D. Tex. February 25, 2020) (small business designated Chapter 11 debtor could retroactively proceed under Subchapter V after the case had been pending approximately 1 month).-In re Body Transit, Inc., 613 B.R. 400 (Bankr. E.D. Pa. March 24, 2020) (small business designated Chapter 11 debtor could retroactively proceed under Subchapter V when the case had been pending 48 days).Second, can a debtor file under Subchapter V, if the debtor is not currently engaged in business? Yes, if a majority of its debt was business debt. -In re Wright, No. 20-01035-HB, 2020 WL 2193240, at *3 (Bankr. D.S.C. April 27, 2020) (debtor who was not currently engaged in business operations qualified as “small business debtor” where 56% of its debt amounted to residual business debt).Third, does a Subchapter 5 Bankruptcy Trustee have the automatic right to retain counsel? No. -In re Penland Heating and Air Conditioning, Inc., No. 20-01795-5-DMW, 2020 WL 3124585, at *_ (Bankr. E.D.N.C. June 11, 2020) (Bankruptcy Petition #: 20-01795-5-DMW) (denying Subchapter V trustee’s application to retain counsel, which was filed as a matter of course, because the need for legal representation had not arisen). A Subchapter V trustee may not retain legal counsel automatically like a bankruptcy trustee can do in a Chapter 7 case.
Clients, accountants or lawyers who have questions regarding Subchapter V should contact Jim Shenwick at 212 541 6224 or [email protected]
Democratic Platform Promises Good New for Student Loans The upcoming elections might help. Student loans are in a special category that bankruptcy law can hardly touch. That’s likely to change after the November 2020 elections. The platform of the Democratic National Convention, says this: Democrats will restore the prior standard in bankruptcy law to allow […]
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