Often, by the time a person seeks our advice, credit issues have lead to one or more lawsuits. If the debtor owns a home, these court cases may have caused liens to be filed against the individual’s home.
A Chapter 7 Personal Bankruptcy will result in a discharge of the debts owed to most unsecured creditors, including all credit card debt, doctors bills, hospital and ambulance bills, oil and other utility bills. However, if one or more of these creditors have already sued and obtained a judgment against the client, and if the client owns a home, there may be judgment liens filed against the home which are not automatically discharged.
Not to fear, in most cases with careful planning, we are generally able to avoid these judgment liens pursued to Section 522(f)(1)(A) of the U.S. Bankruptcy Code. So long as the lien impairs the equity which the client is able to exempt under section 522 of The Code, the lien can generally be avoided by a judicial proceeding which results in a court decree voiding the lien.
For more information, speak with our bankruptcy attorney, Attorney Derek Poirier. He can be reached at (860) 522-8296 or at email@example.com.