Question about judgment lien on our home/real estate

[crystald1156]

We have an appointment to sign all the paperwork for filing the last week of the month. I opened the mailbox yesterday, and there is a paper from one of the junk debt collectors saying they had filed a judgment lien on our real estate. In Virginia this is done through the circuit courts. So I called the circuit court for my county and they advised me that they had 2 judgment liens against our home (real estate). So I instantly called the lawyer and I am going to get copies of the judgment liens that are filed today to take to them.

My question is how these are treated in bankruptcy? We are planning on keeping our home, but the 2 debts listed above were to be discharged with the bankruptcy.

Just when I thought we were on the verge of freedom......

[crystald1156]

meant to add that the debt was capital one....go figure!

[btbeme]

You will be fine. Judgements take a little more time and effort for the attorney to scrape off, but it can and should be done (for a small fee of course). But no worries. The worst part about a judgement is the eventual wage garnishment, which can take a few week minimum to get moving. Your atty might advise the circuit court that you have retained him with the intention of filing Ch 7 which might slow them down. But all in all you will be fine. Just bad timing is all.

[bcohen]

You will be fine. Judgements take a little more time and effort for the attorney to scrape off, but it can and should be done (for a small fee of course). But no worries. The worst part about a judgement is the eventual wage garnishment, which can take a few week minimum to get moving. Your atty might advise the circuit court that you have retained him with the intention of filing Ch 7 which might slow them down. But all in all you will be fine. Just bad timing is all.

This advice is not correct. It is true that for a non-homeowner, getting judgments set aside in bankruptcy is not too difficult, as long as the underlying debt is dischargeable, because the judgment doesn't really attach to anything. However, this is not merely a judgment--it is a lien on the OP's house.

A properly recorded judgment lien will survive bankruptcy, unless it interferes with your homestead exemption and/or is completely unsecured by any equity. If the house has more equity than the homestead exemption allows, then the judgment lien is secured, and cannot be stripped or set aside in bankruptcy. If you are still paying on a mortgage, then it is very likely that your house does not have more equity than the homestead exemption allows, which means that the judgment lien is completely unsecured, and can be stripped.

In any case, the big question should be were you ever served with the lawsuit(s) that resulted in these judgments? If the answer is "no" then you need to file the appropriate motions to vacate the judgments, which will remove the liens, and then promptly file bankruptcy before the collection attorney can sue you again.

[tobee43]

yes, you can have the judgement removed no question. your atty will have to list the docket numbers on your petition. (there is actually a section to list them), after you discharge and close the firm can file a motion to vacate the judgements provided they are unsecured creditors and you did say they are captial one, so there should be no problem.

you need to ask you atty how long you must wait until after the discharge to vacate the judgements, for example, in nj you can do it immediately after the close and discharge of your bk, however, in other states such as florida, you must wait an entire year to get them removed.

nj is and was notorious for never doing proper servicing of the summons for the judgements, and the courts still grant them. the banks have hooks in the system and they get these judgements through like free flowing water in a river. so really, if you go to court and say you were never served, even though, it's against the law technically , unfortunately, no one is really going to care. in the state i came from there were more judgements granted more likely with improper service than those that were actually served within the guidelines of the law.

just to let you know, i have known numerous people, including myself that have done this.

the fact is, you will be about to get them removed, just find out what if any is the waiting period after your completed your bk. best of luck!