If you are considering filing bankruptcy, contact us today for a free consultation. For more answers to frequently asked questions, please see our massive resource here: Los Angeles Bankruptcy Lawyer.
Will California bankruptcy get rid of liens against my property?
A lien is a legal right to a security interest in real estate or personal property. It operates to secure an underlying debt like a mortgage or a car loan. If a lien is properly recorded or registered, the person or entity asserting that lien is said to have perfected it. Perfection of a lien interest gives that creditor considerable leverage over the secured property in the event that the borrower stops paying on the loan for it.
A lien can survive after a bankruptcy
If you’re filing for bankruptcy, and you have one or more liens on property, it’s important for you to speak with one of our knowledgeable and experienced bankruptcy lawyers. That’s because a lien doesn’t just vanish after somebody has been discharged in bankruptcy. The debt to a creditor can be discharged, but the lien can still survive if it has been properly perfected.
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Debts vs. Liens
People go into debt every day. They go to a lender, sign off on papers acknowledging a loan, agree to a payment schedule, and then they make their payments until the debt is paid off. That’s called an unsecured debt. It’s based solely on the borrower’s signature. There’s no collateral that operates as a security interest. If the debt is being secured by collateral like a home, a car or even a Rolex watch, a lien interest arises. If there’s a lien interest, and the loan has not been paid back, the creditor can act on the property for purposes of satisfying the debt. That debt might be discharged in bankruptcy, but if proper action isn’t taken by a knowledgeable and experienced bankruptcy attorney, the lien will probably survive after the debtor is discharged in bankruptcy. This situation often presents itself after a judgment has been taken against a person, and the judgment lien is properly perfected.
Get a lien search
Before visiting us, it’s important that you go to the office of your Recorder of Deeds or Registrar of Deeds for a judgment lien search, especially if you’ve been sued, and a judgment was taken against you in the past. If there’s a lienholder out there, we might be able to negotiate with that creditor to the lien removed. If the creditor hasn’t perfected the lien, it might be deemed to be unsecured, and we might be able to have it discharged. If a lien ends up surviving a bankruptcy, the collateral for the loan can still be repossessed.
Contact a Los Angeles Bankruptcy Lawyer today
After you’ve had a lien search performed, contact our offices for a free consultation and evaluation with a bankruptcy lawyer from our law firm. We can help you get a better understanding of how liens might be dealt with in your particular case.
We assist people with bankruptcy in the following areas and counties of California:
- Los Angeles County
- San Fernando Valley
- Orange County
- San Bernardino County
- Riverside County
- Ventura County
- Santa Barbara County