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Can a Judgment Lien Be Removed in Bankruptcy?

Serving Families Throughout Mobile
Yes, a judgment lien can potentially be removed in a bankruptcy case through a legal process called lien avoidance. However, whether or not a judgment lien can be removed depends on various factors, including the type of bankruptcy case filed (Chapter 7 or Chapter 13), the value of the property in question, and the specific circumstances of the debtor.

In both Chapter 7 and Chapter 13 bankruptcy cases, debtors may have the option to remove certain judgment liens from their property through a process known as lien avoidance. This process allows the debtor to ask the bankruptcy court to remove the lien because it impairs an exemption to which the debtor is entitled.

Here's a general overview of how lien avoidance works in bankruptcy:

Determination of exemption: The debtor must first determine whether they are entitled to claim an exemption that covers the equity in the property subject to the judgment lien. Exemptions protect certain types and amounts of property from being seized by creditors to satisfy debts.

Motion to avoid lien: If the debtor believes they are entitled to claim an exemption that would cover the equity in the property, they can file a motion with the bankruptcy court to avoid the judgment lien.

Court decision: The bankruptcy court will review the motion and consider factors such as the value of the property, the amount of the judgment lien, and applicable state and federal bankruptcy laws. If the court determines that the lien impairs an exemption to which the debtor is entitled, it may grant the motion and order the judgment lien to be avoided.

It's important to note that the specific procedures and requirements for lien avoidance may vary depending on the jurisdiction and the circumstances of the case. Debtors should consult with a qualified bankruptcy attorney for guidance on how to proceed with lien avoidance in their particular situation. Additionally, not all judgment liens may be eligible for avoidance, and there may be limitations on the types of liens that can be removed through this process.
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