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Bankruptcy & Debt Settlement During the Covid-19 Crisis

WCovid-19 and Bankruptcy e will regularly update this post to provide answers to common questions about bankruptcy, debt settlement, foreclosure, and other financial issues during the Coronavirus (Covid-19) crisis. Please note that all of our bankruptcy and debt settlement services are available, and we still offer free bankruptcy and debt consultations via phone or video. Now, on to our FAQ: 

Can I consult with you about my debts during the crisis? Yes, we offer a free debt consultation by telephone and video conference (Zoom©, Skype©, FaceTime©, etc.) See our telephone and video meeting page for more details. To schedule a consultation, call us at 215-248-0989 or use our contact form. 

Can I file for Bankruptcy during the Covid-19 crisis? Yes. All aspects of Chapter 7 bankruptcy and Chapter 7 bankruptcy cases from the initial consultations can be conducted via telephone, video, email, and our secure client portal. (We are still receiving postal mail for clients who prefer to mail documents to us.) We file all cases electronically, and the courts have required all bankruptcy hearings to be held via telephone or video for the present. 

Are you offering debt settlement/debt negotiation services while the crisis is still in effect? Yes, our debt settlement/debt negotiation services are available during the crisis. We can obtain all the information we need from you via phone, video, email, and our secure client portal. Not surprisingly, most creditors and debt collectors are still operating, and we can reach them to discuss settlement. (However, some collectors appear to be understaffed.) 

Are the bankruptcy courts and trustees’ offices open during the emergency? Yes, for the time being, the bankruptcy court and trustees in the Eastern District of Pennsylvania are conducting all hearings, such as the meeting of creditors, via telephone and video. To date, the courts are still doing business but with safeguards in place to protect the public and court personnel. If you are a client of Harborstone Law, we will keep you informed of any changes to the court schedule and procedures.

Can my bank or mortgage company foreclose on me in Pennsylvania during the Covid-19 crisis? Mortgage holders cannot foreclose or evict until the foreclosure moratorium ends. Presently, it is scheduled to end on July 10, 2020.

Is my bank or mortgage company required to provide me with a forbearance? It depends on what type of mortgage loan you have. Under the CARES act, If you have an FHA, VA, USDA loan, or a loan backed by Fannie Mae, Freddie Mac, your mortgage loan provider must offer you a forbearance of up to 180 days with an option for an additional 180 days. The specific payback options include adding the forbearance amount to the end of the loan (deferral), paying back the full amount in a lump sum, or a payment plan. About 75% of all mortgage loans fall into the government-backed category.

Can I obtain a forbearance if my mortgage is not government-backed? If your mortgage loan is not government-backed, there is no forbearance requirement. Moreover, the lender is not required to allow you to tack the forbearance amount to the end of the loan. Therefore, even if the lender offers a forbearance, be sure that you understand the repayment terms before accepting it.


May 7, 2020. Pennsylvania Governor Wolf has extended the moratorium on foreclosures and evictions for 60 days until July 10, 2020. The move should alleviate the immediate concerns of struggling homeowners and renters. At the least, it gives them some additional time to look at long-term options 

May 7, 2020. The governor of Pennsylvania has extended the stay-at-home order until June 4, 2020. This order will not affect our telephone and video services. However, it is likely to have a continued impact on the courts, particularly in the area of scheduling.

March 20, 2020: The U.S. Bankruptcy Court for the Eastern District of Pennsylvania has suspended the requirement under Local Bankruptcy Rule 5005-7(b) that attorneys secure the debtor’s signature on the petition and schedules before filing the case electronically. Attorneys may obtain the client’s signature electronically (1) through authenticated commercially available digital signature software, either directly or with the debtor’s written permission (email permission is acceptable); or (2) through a copy of the signed documents sent to the attorney electronically (email, fax, etc.). The Bankruptcy Court has also issued some general and specific guidelines to deal with the disruptions likely to be caused by the Coronavirus.

March 18, 2020. The U.S. Bankruptcy Court for the Eastern District of Pennsylvania has extended some deadlines (primarily related to creditor objections), until May 18, 2020. 

March 19, 2020. The Pennsylvania Supreme Court has issued an order suspending evictions for failure to pay rent, loans, etc., until April 3, 2020. We will see if the court decides to extend this policy. 

March 16, 2020. The U.S. Bankruptcy Court for the Eastern District of Pennsylvania has ordered that all hearings be held telephonically when possible until further notice. The courts will continue to conduct business to the extent possible. 

The Standing Chapter 13 bankruptcy trustee for this district is in the process of implementing all telephonic meetings of creditors (341 hearings). The trustee’s office had previously permitted debtors and their attorneys to appear by video (Skype, FaceTime, etc.) at the meeting of creditors for the duration of the crisis. Also, the trustee has continued some meetings to later dates.

March 16, 2020. The United States Trustee has ordered all 341 hearings (meetings of creditors) in this region scheduled through April 10, 2020, continued until further notice, unless held telephonically or via video. 

Your safety is our primary concern. We will update this notice as more information becomes available.