how does an attorney avoid a lien

If you own a home and a creditor has obtained a judgment against you, ask your bankruptcy attorney about filing a Motion to Avoid a Judicial Lien. In the appropriate situations, your attorney can file a motion with the bankruptcy court requesting that the judicial lien be removed from your home upon completion of your bankruptcy.

Full Answer

Can a lawyer challenge a lien on a case?

Chapter 13 has two ways that you can avoid liens—through a lien cramdown or lien stripping. Cramming Down Liens in Chapter 13 You might be able to reduce the principal balance of some liens through a Chapter 13 cramdown. For instance, using a car loan cramdown, you can reduce your loan balance to the value of the car.

How do I avoid a lien on my property?

Jan 25, 2016 · Motion to Avoid a Judicial Lien. If your attorney is aware of the judicial lien(s) and you do not have any non-exempt equity in property to secure the liens, your attorney can file a motion to avoid a judicial lien to prevent the judicial lien from affecting you in the future after the debt was discharge in your bankruptcy.

Do I need a lawyer to remove a lien?

Aside from filing for Chapter 7 Lien Avoidance, some other ways to avoid a lien or lien liability include: Satisfying the debt: If the debtor is able to pay off their debt in full, they should do so immediately since this can... Requesting redemption: The …

How do I avoid a money judgment lien in bankruptcy?

May 31, 2011 · A lien can be avoided if it impairs a debtor’s exemption to which the debtor would have been entitled if not for the lien. For example, if a debtor owns a television which is encumbered by a lien, and the debtor has sufficient exemptions available to exempt the television if not for the lien, then the debtor can avoid that lien, meaning the television will no longer be …

What is judicial lien?

A judicial lien is created when a party records a judgment in probate court after winning a lawsuit. If the judgment is recorded in the county where the losing party resides then there is a judicial lien placed on non-exempt property owned by the party (i.e., real estate, personal property, etc.). The judicial lien can attach to current ...

What happens if you file Chapter 13 bankruptcy?

If you have any equity in property then your bankruptcy attorney will discuss how to address that equity in your bankruptcy . If you file a chapter 13, you should be able to pay the value of the equity that cannot be avoided through your plan with interest. If you filed chapter 7, then you will have to pay directly to the creditor the value ...

What happens if you file chapter 7?

If you filed chapter 7, then you will have to pay directly to the creditor the value of the equity plus interest to avoid the creditor from pursuing your property in the future for the amount that could not be avoided.

Can a judicial lien be avoided in bankruptcy?

The lien survived your bankruptcy and you should contact your bankruptcy attorney to find out how to reopen your bankruptcy case so that a motion to avoid a judicial lien can be filed against that judicial lien. To reopen your bankruptcy case, the court will charge you a reopen fee. If you have discovered judicial liens have been filed ...

How to resolve a lien dispute?

Lien disputes can often be resolved by reviewing the terms of the original contract formed between the debtor and creditor. If such a contract exists, it will typically contain important information about the lien like what conditions must be present to trigger its enforcement.

How to avoid a lien in Chapter 7?

Aside from filing for Chapter 7 Lien Avoidance, some other ways to avoid a lien or lien liability include: 1 Satisfying the debt: If the debtor is able to pay off their debt in full, they should do so immediately since this can remove the lien. 2 Requesting redemption: The amount of debt owed to the lender may be different than the actual value of the property. Redemption allows a debtor to pay the full value of the property and avoid lien liability, even if there is still some remaining balance of debt (e.g., accrued interest). However, it should be noted that this option may only be used in certain situations. 3 Surrendering the property: If the property is surrendered to the debtor, the debtor will have about 30 days to reclaim the property. Additionally, if a creditor does not claim it within this time period, the property will be listed as “abandoned”, meaning it will be free of any liens or debt. Although this is one of the most common ways to avoid a lien, it is also one of the riskiest. If the creditor claims it, then the debtor can lose their property.

What is a lien on a loan?

In general, a lien is a type of legal document that gives a creditor the right to claim a debtor’s property in the event that they default on their loan or debt payments. A lien helps to ensure that the borrower will eventually pay off their debt, or else they will risk losing that property to the creditor or lender.

What is a lien on a debtor's property?

There are several different types of liens, but one of them in particular stands out when it comes to filing for bankruptcy. A Chapter 7 Bankruptcy lien, more commonly referred to as a judgment lien, is a lien that attaches to a debtor’s property after a creditor or lender files a lawsuit and obtains a money judgment against them.

Does bankruptcy remove a lien?

This is because bankruptcy does not remove a lien unless the debtor files for lien avoidance. Also, if the property is unavailable for some reason, the creditor may still sue the debtor for its value. For example, suppose a debtor uses their credit card to purchase a washing machine for their home.

What is a lien on a property?

A lien can attach to various types of property. Depending on the kind of lien, a lien can attach to either real property, personal property, or both. Real property refers to things, such as houses, buildings, and plots of land. For example, when a borrower takes out a loan against their home, the lender may place a lien on the property.

What documents are required to file for Chapter 7 bankruptcy?

If the debtor qualifies for Chapter 7 Bankruptcy Lien Avoidance, then they must submit certain evidence to the court, such as tax documents, property paperwork, and bank statements. As of 2020, the laws on Chapter 7 Lien Avoidance have undergone some changes due to present economic conditions. Therefore, if you have a dispute over ...

What is Medicare lien?

To enforce this right to reimbursement, a “Medicare lien” will attach to judgment or settlement proceeds that are awarded as compensation for the accident. This means that if you get a settlement, you will have to pay back Medicare before anything else gets taken out.

What happened to Maryland malpractice law firm?

A Maryland malpractice law firm recently had to pay $250k for failing to pay off a Medicare lien. The firm had obtained a $1.15 million dollar settlement for one of its clients in a medical malpractice case. This client happened to be a Medicare beneficiary for whom Medicare had made conditional payments. Medicare had been notified of the settlement and demanded repayment of its debts incurred. But the law firm apparently refused or failed to pay the lien off in full, even after an administrative finding had made the debt final.

What is the purpose of the MSP?

The purpose of this law was to make sure that sure Medicare was not paying for medical bills that should be paid by someone else. The MSP gives Medicare the right to claim (i.e., a lien) reimbursement from any judgment or settlement proceeds that include compensation for medical bills paid by Medicare.

Is Medicare a secondary payer?

Under the Medicare Secondary Payer (“MSP”) statute, when another payer (the “primary plan”) is available, Medicare, as the “secondary plan,” is not responsible for paying for the medical services. 42 U.S.C. § 1395y (b) (2) (A).

What happens if Medicare is not paid off?

If a Medicare lien is not properly handled and paid off, Medicare is permitted to file against the defendant, the plaintiff, or the plaintiff’s counsel. If Medicare is forced to bring suit against a party to collect its lien, in some situations it is entitled to a civil penalty of two times the amount owed. Additionally, Medicare can fine the “Responsible Reporting Entity,” usually the insurer, up to $1,000 for each day that they are out of compliance with Medicare’s reporting requirements. That is some harsh medicine. It leaves insurance companies stone terrified.

Does Medicare have a super lien?

The law gives Medicare “ super lien ” for reimbursement. This means that Medicare, Medicaid, and Medicare Part C plans now all have super lien rights.

Medicare Liens

• How Medicare Liens Work in Personal Injury Cases
  If you are injured in an accident and Medicarepays for some of your treatment, you will be obligated to reimburse Medicare for these payments if you bring a personal injury claim and get financial compensation for the accident. This federal law also unambiguously gives the Medicar…
• The Nature of the Medicare Medical Lien
  To enforce this right to reimbursement, a “Medicare lien” will attach to judgment or settlement proceeds that are awarded as compensation for the accident. This means that if you get a settlement, you will have to pay back Medicare before anything else gets taken out. While you ca…

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