Avoiding (Getting Rid of) Liens in Chapter 7 Bankruptcy

A judgment lien is created when someone wins a lawsuit against you and records the judgment against your property.

A lien is created when a creditor or someone else has a security interest in your property. Liens comes part and parcel with secured debts. A debt is secured if it is linked to a specific item of property, called collateral, which guarantees payment of the debt. If you don’t make payments when they are due, the creditor can repossess the collateral. The creditor’s legal claim on the collateral is called a lien.

You may be able to get avoid (get rid of) judgment liens in Chapter 7 bankruptcy.

Surrendering secured property in Chapter 7 bankruptcy? Learn the process, pros, cons, and how to handle various secured debts like mortgages and car loans.

You might be able to keep financed personal property in Chapter 7 by paying the creditor its value in one lump sum, a process known as Chapter 7 redemption. Often, people find they pay significantly less than what they owe.