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Help! Help! How can you get rid of a lien post-Chapter 7?

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    Help! Help! How can you get rid of a lien post-Chapter 7?

    I am so confused!

    My house went to foreclosure in spring 2010.

    The mortgage company got a judgment and lien against me.

    Then later in the year I filed Chapter 7 and included the mortgage debt in the bk.

    So my Chapter 7 was discharged a couple of months ago, but a few weeks before it was discharged my lawyer filed a "motion to vacate lien" due to the anticipated discharge of the debt. No creditor objected so it seemed like a no-brainer.

    But instead of granting the motion, the judge scheduled an evidentiary hearing to discuss it -- and at the hearing this week, he denied the motion.



    The judge said that the lien cannot be vacated.

    Is this possible?

    The motion was denied without prejudice so my lawyer is going to do some research and appeal.

    I'm just confused because my lawyer made it sound like this was a routine thing that is done all the time. Now I'm wondering if he screwed up or maybe if he doesn't know what he's doing. I thought I was getting a clean slate with my BK but I guess not? I am terrified of having this judgment hanging over my head the rest of my life.

    Do I have any hope here? Any advice?
    Last edited by bluemartini; 05-24-2011, 07:59 AM.

    #2
    Something doesn't sound right. If the debt was discharged, what was the lien against? (Was the lien against you personally, or the house?) Normally if one is sued on a debt a judgment for garnishment is created, or a lien placed on personal property (like your home) Do you have a copy of the lien and what does it say?
    Filed Chapter 13 02/2006 - Confirmed 05/2006 - Discharged 09/2011
    I'm not an attorney. My replies are merely suggestions or observations, not legal advice. As always, consult with an attorney before making any decisions.

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      #3
      If you're giving up the house the lien won't matter. If you're keeping the house the lien is secured by the house if it was your mortgage company that got the lien.

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        #4
        Thanks Newbie, I agree something doesn't sound right. Probably because I wasn't understanding the situation correctly and therefore didn't explain it accurately.

        I'm looking at the document now. It's a final judgment of mortgage foreclosure and it says after the property is/was sold, the proceeds would be distributed by the clerk, blah blah, and that the mortgage company had a lien on the property. In other words the lien was on my old house that ended up going to foreclosure about a month later.

        It also says that "jurisdiction of this action is retained to enter further orders as are proper, including, without limitation, deficiency judgments, except where a discharge is applicable," etc.

        Well, anyway, while I was typing that, my lawyer called back and explained that he had researched it and found that the judge was correct and that no, the lien cannot be removed at this point.

        I asked him what my options were and he said basically there are none, that this basically means I can't buy a house in my county as long as that lien is there.

        I honestly have zero interest (or financial ability) to buy a house in my county ever again, so I couldn't care less whether the lien is still there. I mean technically it would be nice to remove it, but for practical purposes that just doesn't affect me. My boyfriend and I are planning on getting married later this year/early next year and he has his own house. If we ever buy a house together at some point, it most likely would be in another area.


        The part I was really happy about was that he explained that I'm not on the hook for future deficiency judgments because the mortgage debt was discharged in the bankruptcy.

        I honestly did not understand that. I was under the impression that as long as the lien was there, I could be sued at any point in the future.

        I was seriously panicking this afternoon and now I feel like a huge weight has been lifted.

        Comment


          #5
          In other words I was mistaken when I typed my original post. The lien was not against *me,* it was against the house. My bad.

          Comment

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