Filing Bankruptcy

Tenant’s Rights During Landlord Bankruptcy

When a landlord files for bankruptcy, many tenants are left in the dark about their rights and protections. Well, the good news is that when a landlord files for bankruptcy, the tenants do not lose any of their rights due to the bankruptcy. What this means is that the rights, as defined in your lease will be respected by the bankruptcy trustee; but it doesn’t necessarily mean that you will be able to stay in your rented home.

For Example: If you are living in a rented home and your lease states that the landlord must give you 90 days to vacate the home if they want to you leave, then the bankruptcy cannot force you to leave sooner. So, let’s say that your landlord is in a Chapter 7 bankruptcy and has been ordered to liquidate the property. The landlord would have to give you the notice to vacate within the parameters of the lease. If you don’t have a lease, typically the landlord can give you 30 days to vacate.

Texas Landlord Rights

The bankruptcy law also states that the landlord’s bankruptcy trustee cannot interfere with the use, possession, or quiet enjoyment of the apartment or premises.  The amount and timing of payments remains the same.  The tenant keeps all existing rights of renewal and extension. It is important to remember, you only have rights that are clearly stated in your lease. In the case of renewal and extension, to enjoy this right while your landlord is in bankruptcy your lease must clearly state that you have a right to renewal or extension.