There is no definitive answer as to how long you can stay in a house that you are surrendering or giving up in the bankruptcy. We tell our clients they will have, at minimum, 30 days they can stay in the home after filing bankruptcy. However, normally someone who has surrendered their property in bankruptcy can stay in their house for two months without many problems. The length a Debtor can stay in the home depends upon how fast the mortgage company takes legal action to gain possession of the home after filing the bankruptcy.
Shortly after the bankruptcy is filed, the mortgage company’s attorney usually will ask the bankruptcy judge permission to begin the foreclosure proceeding to gain legal title and possession of the home. This is known as asking for a “relief from the automatic stay” from the court. If the client is giving up or surrendering the home, the judge will usually allow the mortgage company to regain title to the home. At this time, it is up to the mortgage company to take action to take possession of the home. This is usually done about 60 days after the bankruptcy is filed. However, we have had clients stay in the home for over 12 months after filing the bankruptcy before the mortgage company took possession of the home – although that time period is not typical.
In conclusion, you will typically have about 60 days and all the way up to 1 year after filing the bankruptcy before you have to leave the home. Again, this depends upon how fast the mortgage company wants you out. We encourage our clients to start looking for a new place to stay when they make the decision to surrender the property.