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Terry L.
Terry L., Attorney
Category: Bankruptcy Law
Satisfied Customers: 2514
Experience:  Better Business Bur 15yrs bankruptcy experience. Chicago Bar
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Just Answer In 2002 I was sued for a very large amount.

Customer Question

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In 2002 I was sued for a very large amount. A judgment was issued with a lien attached to my property.
I went bankrupt 2004, which the debt of ½ million was discharge; however the lien is still on my property.
In 2005 I received a huge surprise, of an inheritance from my deceased mother in law. This therefore became an asset. The monies were supposed to go into an escrow account, but the opposing attorney had a motion put in to garnishee the funds from escrow account. The opposing attorney is supposed to hold the funds until we can come up with a settlement. He the opposing attorney hired a real estate attorney and the real estate attorney is trying to go after some escrow in my house which is about 60 thousand.
My questions:
1. Is this legal even after the bankruptcy has been discharged?
2. I offered them a settlement of the inheritance to release the lien
3. My attorney put in a motion to avoid the lien and its entirety.
4. The opposing attorney wants to go to court and get the escrow from my house; this means I will have to testify to how much my house is worth at the time in 2004. This is going to be hard to do because I do not know how much it would have been then. I do have an appraisal.
5. Isn’t this illegal to go after a debt that has been discharged in bankruptcy?
Submitted: 4 years ago.
Category: Bankruptcy Law
Expert:  Terry L. replied 4 years ago.
If the motion to avoid the lien was done and granted during the chapter 7 bankruptcy case, then the debt should be cleared off the title. Either way, the creditor should not be able to collect on the debt because of the discharge. If the lien was never avoided during the case, the lien would still remain, although the debt is discharged (sounds strange, but that is correct) If so, the lien will get paid upon sale or refinance. You may have a good case for violation of the bankruptcy discharge. If your mother in law passed away more than 6 months after bankruptcy discharge, then it is not a bankruptcy asset, and should be yours too keep. The lien will remain on the home unless the lien interferes with 100% of the exemption you are entitled to at the time of the bankruptcy filing. If it wasn't done during the case, your lawyer will need to reopen the bankruptcy, bring a motion to avoid the lien. You will need an appraisal from the time of the case, the balance on mortgages at that time, as well as the exemption. Hope this information clarifies the matter. Good luck.
Customer: replied 4 years ago.

My mother in law passed away before I filed bankruptcy. My case has been reopened due to the sale of her property and I inherited some of the sale. My attorney has now this year put in to avoid the bankruptcy; he included the mortgages, exemptions, and value of the property in the motion including the lien amount. So he put in to avoid the lien in its entirety.

 

Will I be able to put in a complaint concerning the real estate attorney and the opposing attorney who sued me for violation of the bankruptcy law? They are both trying to go after a debt that is discharged

 

I did have some equity in my home at that time. So therefore are you saying the ones who sued me can get the equity from my house as well as the inheritance? That is what the real estate attorney is trying to do.

Expert:  Terry L. replied 4 years ago.
If she died before the bankruptcy, this is an asset of the bankruptcy case, for which the trustee can liquidate to pay your creditors. If the case has discharged, and has not been withdrawn, then you may have a case to sue for a bankruptcy discharge violation if this was included in bankruptcy and discharged. They are permitted to pursue the equity in the home because of the lien, but should not be able to collect on the debt otherwise if discharged.
Customer: replied 4 years ago.
So, if they get the equity in my home and a motion to avoid the lien is warranted and agreed to avoid the lien then they cannot come after me to get more money is this correct. How long can they collect on the lien? Since the real estate attorney is wanting to get more than what I have and I am not going to sell my house from my understanding I can sue both attorney's for violation of the bankruptcy law correct?
Expert:  Terry L. replied 4 years ago.
If the debt is discharged and they attempt to attach anything that is not warranted, then yes, you may have a claim. You should send your bankruptcy notice to them certified mail. You then should wait until the motion to avoid the lien is granted, or perhaps bring the discharge motion concurrently.
Terry L., Attorney
Category: Bankruptcy Law
Satisfied Customers: 2514
Experience: Better Business Bur 15yrs bankruptcy experience. Chicago Bar
Terry L. and other Bankruptcy Law Specialists are ready to help you
Customer: replied 4 years ago.

Good evening,

 

Terry you have been so helpful with my case. The opposing side did not accept the settlement we offered them. So therefore we are going to court next month. I have some equity in my house, I received an asset as you know from my mother in law, my attorney put in to avoid the lien and its entirety. The real estate attorney is going to pursue the equity in my home, however I have a mortgage and with the lien I cannot get the money to give to them the money from my home. Unless the lien is lifted or avoided. I have a feeling this is going to happen, but my attorney is fighting saying I do not have any equity. HOW long can they collect my equity in my home; will it be a one time deal or everytime I refinance? They can have the equity, except I want the exemption from my husbands estate since they did not accept the settlement offer. We were going to let them have the full inheritance to get the lien removed. But they didn't accept the settlement. How can I give them the equity when I have a mortgage and do you feel the lien will be avoided in my situation? How long can they collect on the equity ? HELP

 

 

Expert:  Terry L. replied 4 years ago.
The lien attaches to the title,and will remain until satisfied (or avoided by the bankruptcy motion we described). If you refinance or sell, it must be calculated in and will be paid.
Customer: replied 4 years ago.

1. Can they put a motion in to stop the avoidance of lien? I hate to keep asking so many questions but this is confusing for me.

2. At the hearing if the lien is avoided, and the judge does award them the small amount of equity in my home since the lien will hopefully be avoided by the judge then therefore if I have to pay the equity then I will but I want have to pay them anything else since the lien will be avoided am I right in assuming this?

Expert:  Terry L. replied 4 years ago.
They can try to object to the motion to avoid the lien, sure.
If the lien is avoided, then that is it, debt discharged and done. If the lien is not avoided, or only for a portion, then you will have to pay the rest eventually.
Customer: replied 4 years ago.

Terry,

 

When a lien is on property there is no way I can get a loan to pay the debt. In your years of experience if you had a case as this how do you feel is best to handle this situation?

Expert:  Terry L. replied 4 years ago.
You may have to wait a long time until the value increases, or else negotiate a release if you are looking to sell...perhaps they would swap collateral if you do not win on the motion to avoid the lien. it sucks, I hear ya!
Terry L., Attorney
Category: Bankruptcy Law
Satisfied Customers: 2514
Experience: Better Business Bur 15yrs bankruptcy experience. Chicago Bar
Terry L. and other Bankruptcy Law Specialists are ready to help you
Customer: replied 4 years ago.
<p>Terry L, please reply soon:</p><p> </p><p>Before I went bankrupty I forgot to mention in the above information; I had a contract for deed on my property at the time of my bankruptcy. Then in April of 05 I refinanced because xxx husband died and she wanted me to get the property back into my name. So therefore since the property was not in my name: </p><p>1. Can they the clients get the equity out of my house since the property did not actually belong to me at the time of bankruptcy in oct. of 04. After I got the property back into my name I realize I took on the lien to the property. My attorney says everything should be avoided and its entirety but the real estate attorney says it has been too long and cannot be avoided. I know you said earlier that yes the lien can be avoided but all of this will be up to the judge. I have to testify about how much my property was worth at the time of the bankruptcy, according to the tax records I told them $53,000+.00 but my attorney said they assessed the property at 25% so therefore the property in question is worth more than that so I all of this in the judges hand. Also, the person who sued me is in the nursing home, so if she does get the money or any portion Her POA will have to turn that over to the nursing home for her care. If he doesn't Medicaid will have a fraudulant case against him and or her. She has a very good mind but needs help with Daily living skills, because of Parkinsons. My attorney is going to bring this out in court hoping this will help in the judges decision...</p><p> </p><p>I have tried to be patient, understanding, and tried to settle with them by offering them the inheritance but they refused. </p>
Customer: replied 4 years ago.
See previous above question... thankyou
Expert:  Terry L. replied 4 years ago.
With a contract for deed, title stays in the sellers name in most cases, until the contract terms are completed, then the deed is transferred over. (unless your contract says something different) Any equity is still yours (in case the buyer defaults) and they can put a judgment lien on that equity, for which you must satisfy to pass clear title when you quitclaim it at the end of the contract for deed.
Terry L., Attorney
Category: Bankruptcy Law
Satisfied Customers: 2514
Experience: Better Business Bur 15yrs bankruptcy experience. Chicago Bar
Terry L. and other Bankruptcy Law Specialists are ready to help you

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