When judgment creditors attempt to collect a judgment, one of the first steps they often take is to place a lien on the judgment debtor’s home. Creditors in California are required to create a lien by recording an Abstract of Judgment at the county recorder’s office. It’s a serious matter, but bankruptcy can help you to remove the lien from your home while getting rid of the debt entirely.
When you receive your bankruptcy discharge it is equivalent to a court order that voids the judgment and stops your creditor from collecting on the debt. You bankruptcy attorney will need to handle the removal of the judgment lien after ascertaining if you qualify. If there is a judgment against you, your attorney will first check to see if there are any liens against your property. Motions must be filed once the existence of lien/s is identified in order to avoid it/cancel the lien under Bankruptcy Code.
Filing for bankruptcy provides you with the opportunity to protect the equity in your home (up to a certain amount). To easily estimate the equity in your home, simply subtract the amount you owe on your mortgage/s from the value of the home. The difference is the equity you currently hold in your home. You might be able to remove the lien on your home if it interferes with your chance to claim your home equity as exempt. California law allows you to protect between $75,000 and $175,000 in home equity from judgment creditors or any creditors in bankruptcy.
If you have a judgment lien against your house and you’d like to learn how to remove it during your bankruptcy process, contact the experts at Westgate Law.