What are the landlord rights with a tenant who files bankruptcy? 3 Answers as of November 05, 2010I have a tenant that is breaking his lease midway through the 1year term. We are trying to hold them accountable for the lease they signed but they say they are not liable:
"Because of our chapter 7 bankruptcy which was approved and all debts etc. were discharged July 27th 2010. We have tried to make the rent payments work but according to the bankruptcy law, we can legally break the lease as we never re-affirmed the lease in our bankruptcy. In case of bankruptcy, the tenants are not responsible for the remainder of the lease should it become a financial strain. The current rent is significantly over the acceptable percentage to income for our household."
What are my rights as the landlord? Thank you in advance!
The Law Office of Mark J. Markus | Mark Markus
Once you obtain permission from the bankruptcy court (via a Motion for Relief From the Automatic Stay), you have the right to evict the tenants pursuant to applicable state law. If there are assets to be distributed in the Chapter 7 case, you should be notified by the court to file a proof of claim so you can share in the distribution with other unsecured creditors for whatever amount you are owed on the contract/lease.
Answer Applies to: California