bankruptcy and lease/option? - Posted by Jennifer(NH)


#1

Posted by Jimbob on October 21, 1998 at 11:07:53:

Jennifer,

No, the courts cannot freeze all income, they will require the person filing chapter 13 to have a bailout plan to pay back the creditors owed, and if acceptable by all parties the court will grant the petition.

Normally what will happen is the person petitioning the courts will set up a percentage of monthly income to go towards the debt payment to their creditors, and they are allowed to keep a certain amount as survival money, that includes rent, food, and basic necessities.

If the tenant stops paying rent, you’ll need to need to proceed with eviction, chances are that wont happen.

There is one bright side, the chances are very unlikely the tenant will be able or willing to excercise their option to purchase, so the non refundable option consideration will be forfeited to you.

Jimbob


#2

bankruptcy and lease/option? - Posted by Jennifer(NH)

Posted by Jennifer(NH) on October 21, 1998 at 08:26:51:

My question is if a tenant/buyer claims bankruptcy how would this affect a long term lease/option agreement or an unrecorded contract for deed. Under a Chapter 13 do the courts freeze all income and money so that a tenant/buyer couldn’t continue paying “rent”? Thanks for your help.

Jennifer