Basic Real Estate Rule of Thumb: What About Bankruptcy Proceedings?

by Isaac Benmergui, Esq on September 10, 2014

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It’s as if we’re opening up a whole new can of worms here, in that this presents the question of a possible course of action presented by a debtor: what about bankruptcy? Can a debtor file for bankruptcy as a way to alleviate the issue and somehow not have to vacate the premises? Interesting questions.

The point of bankruptcy was to try and cover all debts, hence eliminating any need for a writ of possession, successfully vacating a debtor, or a tenant, from a real estate property. There’s, yet again, just one other problem, though. Such a bankruptcy court can look at the situation and say that a final judgment for possession, or even an issuance of a writ of possession doesn’t necessarily constitute a lease termination. This means that even when a writ of possession or judgment of possession has been issued by a court, a debtor or tenant can actually still assume the lease as that hasn’t effectively terminated the contract.

This then means a tenant can still have a chance in paying any real estate arrears, albeit with interest, and continue the lease as usual. Bad news for a landlord, obviously. This was further buttressed by the fact that under state law, generally speaking a tenant still doesn’t lose possession of a property until the writ is properly executed. The judgment isn’t the same as the execution, in other words.

Until that execution occurs, a tenant could do his or her very best to catch up on the rent payments. Typically there would be a deadline at that point. What happens if a tenant or debtor manages to make up the lost payments? You’ll see….

Basic Real Estate Rule of Thumb: Courts Taking Appropriate Action

by Isaac Benmergui, Esq on September 9, 2014

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A state court can put its foot down, obviously, for good reason upon analysis of the evidence. It’s very simple: debtor failed in making payments, a default notice was issued, and an automatic stay was imposed. However, during that automatic stay, the court can obligate the debtor to pay all past due rents, and even ongoing rent payments, to the court registries, and to make it even more interesting….

If the debtor’s late in making those payments by even one day, it could result in a default judgment for possession, issuing a writ. The court could even order a debtor to vacate the premises completely. This holds more water than even a landlord taking authority and demanding that a tenant leave. Not only would law enforcement be involved, but the courts would be involved. There’s more authority in that order, hence why it’s always a good idea for a landlord to involve the judicial system in this case.

This could be construed as a victory for the landlord, for obvious reasons. It served the landlord’s purpose perfectly. Even after a debtor could even file for a request to reconsider with the court, there would be no recourse of action, especially if the court, as promptly described, would “put its foot down” and make a judicial order in writing.

Even then, a debtor could take this one step further, sadly enough. This will blow your mind – but this is to the extent of just what real estate law can offer for both parties in a fair and equitable manner. Read on….

Basic Real Estate Rule of Thumb: Talking About “Tenants at Will”

September 8, 2014
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What happens if the landlord contends that the real estate lease is no longer in effect? This, obviously, is due to the fact that a default notice was issued, stating that the tenant was late on the rent payments. Fair enough. What happens if the lease isn’t in effect anymore? We have a situation where a tenant no longer is under contract, per se, but at will.

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Basic Real Estate Rule of Thumb: the “Default Notice” Is Not the Lease Termination

September 5, 2014
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Welcome to this particular series of important information regarding lease terminations. This is key – for both the tenant and the landlord, for several reasons. One, as the renter, you have to understand this important fact: the “default notice” you’ll get on your door for late payment doesn’t necessarily constitute a lease termination. That means you’re not yet set to have to vacate the property – not quite just yet.

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Saving a Frog’s Real Estate By Law in Louisiana

September 4, 2014
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Yes, real estate law extends even to our friendly amphibians, and for good reason: wildlife preservation is a key aspect of our policies in property law, and they should always be observed. It doesn’t matter if the mammal or reptile is endangered or not. If it’s their habitat, law should protect it.

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