Lien and Wage Garnishment

[confusedincali]

Ok I am working with an attorney but am still a little confused on this issue.

Before I filed, a creditor got a judgment against me, and then got a wage garnishment to collect it.

The garnishment took effect on 9/1, we filed on 9/15. They took it out of my paycheck on both 9/1 and 10/1.

Now as I understand it I will be getting back the 10/1 garnishment but they will get to keep the 9/1 garnishment.

But I have heard we might need to file a motion to make sure they don't collect after the case is dismissed.

Others tell me that since the debt is being erased in the bankruptcy we don't have to because there won't be anything left for them to collect on.

What should we do ?

Should I ask my attorney to do a motion to get rid of the lien ?

Is there any way to get back the money collected on 9/1 ?

[Spartan]

I don't know about the mechanics involved in vacating the judgement and setting aside the garnishment order. But I believe the whole thing is going to be wrapped up in the BK proceeding and would NOT require a separate motion after the discharge. It should be taken care off during the discharge.

Instead of asking your attorney about filing a motion to set aside the garnishment AFTER the discharge, why not ask him/her about how the judgement and the garnishment is squashed in the BK proceeding?

Let us know what you find out.

As for the 9/1 garnishment, it is gone, much like your previous payment made before BK. Surely, you don't think the CC will refund you those payment, do you?

[poorme]

The lien is a separate instrument filed in local county/state courts and is outside the bk court's administrative control. The debt, however, is absolved in the bk filing/discharge. Generally, you (or your attorney) can petition the local court to vacate the lien after the discharge. Most courts have forms or you can contact the local clerk to ask how their process works.

So, even though your responsibility to pay the lien is wiped out in bk, and the lienholder's ability to collect is also blocked, if the lien remains active in the court it shows up in your public records on your cr reports. It's in your interests to get the lien vacated, and that will be easier post discharge.

Having said that - forget the above if this is a tax lien....they aren't usually discharged in bk and do require extra work.

[Credit Hater]

I don't know if the laws differ from state to state, but in researching, I have discovered that the lien may not be removed if the property it is attached to has an equitable amount close to or over what the lien is worth. It then boils down to the lien holder and property holder working out a solution or settlement. And this is after the BK has been filed and the debt discharged.

But something bothering me is this: if the lien isn't removed because of substantial equity, would the lien holder still have the right to seize the property and force a sale?.....and if so, the owner of the property should still be entitled to their state's exemption first and foremost, right?

So unless you have property worth the time and fee's involved with this (such as a yacht or vacation home that is paid for and worth a lot more than the lien itself), then my opinion would be that they wouldn't go after the property. It will just sit there and look bad on your credit report. I don't know how long they would have the right to report this on your credit, but if you're like me and don't care what your credit score is, then it won't matter. But if you need a good credit score within 5-7 years, then filing BK before a lien is placed should be priority #1. Liens can last up to 10 years or longer, and they can be renewed before they expire (as long as the lien holder is on their game).

[confusedincali]

Thanks for the answers. I don't own any property, so as far as I know all they did was get a wage garnishment to take the money out of my paycheck.

So if the debt goes away, and I already have the bad hit for doing the bankruptcy then what can they really do to me ?

[Spartan]

The lien is a separate instrument filed in local county/state courts and is outside the bk court's administrative control. The debt, however, is absolved in the bk filing/discharge. Generally, you (or your attorney) can petition the local court to vacate the lien after the discharge. Most courts have forms or you can contact the local clerk to ask how their process works.

So, even though your responsibility to pay the lien is wiped out in bk, and the lienholder's ability to collect is also blocked, if the lien remains active in the court it shows up in your public records on your cr reports. It's in your interests to get the lien vacated, and that will be easier post discharge.

Having said that - forget the above if this is a tax lien....they aren't usually discharged in bk and do require extra work.

Thanks for correcting me.

Would what pertain to lien be the same to garnishment then?

[poorme]

Without other specifics, yes. The garnishment is just a means of the creditor to get the monies owed, which are substantiated by the lien. So they sued, and got a lien issued. Then, they use the lien which entitles them to the money to attach to the paycheck (since there's no other property).

The bk stops the collection and garnishment, and subsequently will release/discharge the debt. Once that's gone, then there's no substantial reason for the lien to remain, and you go have that vacated in the local court. If the lien remains in court then the creditor can keep it renewed..although there's nothing they can collect. Bit some A-hole creditors will try to do that just to screw with you and your credit if you don't get it removed from your Public Records.

Ain't this funnnn...???

[razorguns]

welcome to bureacracy hell. you'll now note just how bad the govt is at paperwork and talking to one another.

good luck. i do feel your lawyer will bill you plenty for the headache he will have to go thru

r

[Spartan]

Without other specifics, yes. The garnishment is just a means of the creditor to get the monies owed, which are substantiated by the lien. So they sued, and got a lien issued. Then, they use the lien which entitles them to the money to attach to the paycheck (since there's no other property).

The bk stops the collection and garnishment, and subsequently will release/discharge the debt. Once that's gone, then there's no substantial reason for the lien to remain, and you go have that vacated in the local court. If the lien remains in court then the creditor can keep it renewed..although there's nothing they can collect. Bit some A-hole creditors will try to do that just to screw with you and your credit if you don't get it removed from your Public Records.

Ain't this funnnn...???

In my case, which I haven't filed yet, I have a judgement, but no lien nor garnishment order executed.

Would vacating the judgement included in the bk proceeding then? Or an extra step be needed POST discharge?

[poorme]

Spartan -
Vacating the judgment is a separate step that you complete post discharge.
If you don't file bk - the judgement stands unless you pay it off. If you pay it off, you can have the judgement avoided (that's the term) and it gets removed from the local court's records.

[Spartan]

ok Thanks for the explaination.

I am thinking of filing pro se as my case is no-asset, simple straight CC debt. Would I be able to file the motion to vacate the judgement post discharge? Is that a simple straight forward procedure?

Thanks in advance.

[poorme]

You'll have to check with your local county clerk's office to find out how straightforward their process is. But that comes later. You should focus on your bk first and get that out of the way.

[Spartan]

thanks very much!