Q:

How do I know if I qualify?

A:

If the fair market value of your home is less than the total of your secured mortgages and homestead exemption, then you may ask the court to avoid a judicial lien.

Q:

What is the difference between avoiding a lien in chapter 13 and chapter 7?

A:

A chapter 7 changes the Judicial Lien from a secured claim to an unsecured non priority claim that is included in the Chapter 7 Discharge Order.   

A chapter 13 also changes the character of the Judicial Lien from secured to unsecured.  In a Chapter 13, there is a plan that pays claim over a 3 – 5 year period of time. The secured claim is paid the same percentage as the rest of the general unsecured claims and included in the Chapter 13 Discharge Order.

Q:

How does the lien go away?

A:

In a Chapter 7: A copy of the Court’s Order Avoiding the Lien is filed with the County Recorder to release the lien.

In a Chapter 13: Generally the Judgment Creditor will file a Satisfaction of Judgment; however, if the Creditor fails to do so, the Debtor may file a copy of the Order Avoiding the Lien and the Chapter 13 Discharge Order to release the lien.

Q:

When do I file the Motion?

A:

In a chapter 13 case the motion is filed on the Petition Date.  

In a chapter 7 case the motion is filed any time between the Petition Date and before the Discharge Order is entered.

Q:

What evidence do I need?

A:

  1. Appraisal of your home. If you are looking for an appraiser, many of our clients have been happy with the services of Bruce Stanton, a certified general appraiser.   (714) 220-2495; appraisergeneral@sbcglobal.net   
  2. Copy of recorded Lien can be obtained from your County Recorder, either online or in person.   
  3. Copy of current monthly statement for all secured mortgage/HELOC loans. 

Q:

Why do I need this evidence?

A:

The burden of proof of the value of the home, the amount of secured liens and the existence of the judicial lien is on the Debtor. 

Q:

How long does it take?

A:

It takes at least 30 days from filing; to obtain an order avoiding the lien unless the creditor opposes the motion, then it can take longer.  Due process gives the creditor time to receive, review and oppose the motion. 

Q:

What are the costs?

A:

Postage and copy:  In some cases the copy and postage costs can be $200 - $300 or more, it depends on the number of pages of the exhibits and motions and the manner of service and the number of parties required to be served.  

Attorney Fees:  The court approved attorney fees for a Motion to Avoid (if uncontested) is $750.  If the creditor contests the motion then the costs will increase proportionally to the additional services required.  Our hourly fees are $350.  

 Appraisal:  You pay the appraiser directly; appraisal costs vary, depending on the property.