Bankruptcy of a Unit Owner

The United States Bankruptcy Code provides that assessments owed to common interest developments after the filing of a bankruptcy petition are no longer dischargeable, to the extent that the assessments are payable while the debtor either lived in or received rent for the separate interest. In other words, so long as the homeowner still lives in the separate interest or rents it out to someone else, the assessments will continue to accrue after the date of the filing of the petition. our firm

After our firm has received written notice from the bankruptcy court that an owner has filed for bankruptcy, the delinquency report will be divided into a pre- bankruptcy petition amount (which will not change) and a post-bankruptcy petition amount. There will be two separate ledgers.

The association may pursue all legal remedies available to collect the post-petition amount notwithstanding the bankruptcy under the circumstances described above.


Bankruptcy Types

Pacific Association Collections