Legal Question in Bankruptcy in California

Judicial Lien after Bankruptcy

I filed a Ch 7 bankruptcy in 1998. At the time I owned several pieces of real property with little to no equity. When I filed I had a creditor who had a civil court judgment lien (abstract filed) that was filed 18 mos. before the bankruptcy in the amount of $122K. I filed a 522(f) motion for my personal residence and won because of now equity but not on the rental property. There was a hearing on the debt (because there was stock sold for $6k) for the estate, to determine the debt's status and the court ordered that the debt to this creditor was a general unsecured creditor for $122K. I am now selling one of the rental properties which has increased in value significantly and the creditor wants payment on the abstract of judgment for the full amount. Wasn't it discharged in the bankruptcy? The property had a small $13K equity at the time of filing and the trustee did not take the property and left it to me.


Asked on 9/03/03, 9:40 pm

1 Answer from Attorneys
Robert Mccoy Law Office Of Robert McCoy

Re: Judicial Lien after Bankruptcy

I would need to see the court order to properly advise you. Having said that, if the lien was not avoided in the chapter 7 case, the lien is probably still valid, even if the debt it secures was discharged. Now that you have more equity in your home(s), it may be too late for you to reopen your bankruptcy case to avoid that lien (without having to pay some money). However, you could file a chapter 13. The amount you would have to pay on the discharged debt would be $0. You would simply pay off all the rest of your debts in full and move to avoid the lien against the house. Then you would get a second discharge, but this time it is possible the lien could be eliminated--but I would really need more info to properly advise you.

Read more
Answered on 9/03/03, 10:24 pm


Related Questions & Answers

More Bankruptcy Law questions and answers in California