Bankruptcy Law Questions? Ask a Bankruptcy Lawyer Now.
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Question: “they say because NY has a statutory lien on settlements, the bankruptcy will not discharge the 30,000 I owe them Is this correct or not.”
Answer: Not exactly, but it requires some explanation. Bankruptcy will discharge the debt you owe. However, bankruptcy does not eliminate a lien. Therefore, once you are discharged you won’t be personally liable for the money. However, since the lien still exists, the property with the lien (stocks in this case?) can be foreclosed upon and sold. Since your personal liability will be eliminated, if the sale of the stocks does not cover what you owe, then the creditor has no other recourse against you.
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