Posted by DK on February 23, 1999 at 20:26:45:
In Reply to: Landlord bankruptcy -- what happens to us? posted by Sunny on February 23, 1999 at 16:36:30:
Under the Bankruptcy Code, it is possible for the bankruptcy trustee (or in the case of a Chapter 11 or Chapter 13 proceeding, the debtor) to "reject" the balance of the lease and ask the Bankruptcy Court to evict you. In that case, you would be entitled to make a claim for your damages arising from the early termination of the lease contract, but your claim is a general charge on the estate and often results in a payment of only cents on the dollar.
In all liklihood, you would probably be allowed to stay until the expiration of the lease.
If your landlord should file for bankruptcy and seek to terminate your lease, you should get advice from an attorney with bankruptcy experience.
: My daughter and I leased our house in 11/98 for two years -- we love it there. The rent is not cheap, and we paid a substantial deposit. I've just heard a rumor that our landlord might be filing for bankruptcy sometime in the near future and/or may have an interested party for the purchase of the home.
: The source of the rumor can't be disclosed -- the individual is too close to the owner and it would cause the family problems. In other words, I have no way to verify until some notice is received personally.
: What happens to us? Depending upon the type of bankruptcy, the end result could vary. What happens to our deposit? By California law, when are we told of the pending issue? It was expensive to move, is there a way to bill for another move? How long do we have to relocate after notice? Etc???
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