Last week, the New York Times had an interesting story about a woman who filed for bankruptcy two years ago, with creditors calling into question her rent-stabilized apartment.
According to the Times, Mary Veronica Santiago, 79, fell behind on her bills before filing for Chapter 7 bankruptcy. Santiago, who lives in the East Village in New York City, now has a case that could put her and millions of other rent-stabilized leasers in New York at risk.
Santiago’s case is pending before the United States Court of Appeals for the Second Circuit, where creditors are trying to argue that her lease can be treated as an asset in her case, just like a car or piece of land, to help pay off her debts.
The trustee in Santiago’s case thinks that the lease should be considered an asset. Her apartment, which she has lived in for 50 years, is a two-bedroom apartment near Tompkins Square Park, in a neighborhood where unregulated apartments rent for thousands more a month than her rent of $703. Bankruptcy lawyers who are closely monitoring the case say it would make it easier for landlords to evict rent-stabilized tenants if they file for bankruptcy, according to the Times.
Rent stabilization laws in New York City limit increases and allow for automatic lease renewals, even providing survivor rights to the family members of tenants who die. According to the Times, the trustee in Santiago’s case has proposed an agreement in which her landlord would pay her debt, and pay attorney fees and court costs, and allow her to continue to live in the apartment; however, she would lose her rent-stabilized lease, and give her no succession rights, essentially forcing her out.
Santiago’s lawyers have opposed the proposal. “It’s an unfair money-grab,” said David B. Shaev, the New York state chairman of the National Association of Consumer Bankruptcy Attorneys to the Times. “To remove this foundation, this safety net, it’s unconscionable.”
Washington D.C. has similar rent stabilization laws, which is why it is important to work with our skilled bankruptcy attorney if you are thinking about filing for Chapter 7. Typically, a Chapter 7 bankruptcy allows you rebuild financially though the discharge of debt like credit card debt or medical bills, making it easier to repay debts that cannot be eliminated over time.
If you are under pressure financially and are leasing a rent stabilized apartment, contact our Washington DC and Maryland bankruptcy lawyer now for a free consultation. Our attorney can work with you to eliminate or consolidate your debt and restore your financial freedom, while giving you counsel about keeping your lease intact.
Law Firm of Kevin D. Judd
Judd’s Judgment: For information about rent control in Washington D.C., you can visit the Department of Housing and Community Development website.