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cfortunato
cfortunato, Attorney
Category: Bankruptcy Law
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Experience:  Bankruptcy professor.
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In Chapter 7 bankruptcy case,after dsischarge but before case

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In Chapter 7 bankruptcy case,after dsischarge but before case closing, creditor amends Petition and Schedules A-C to switch from New Mexico law to federal law 11 USC 522(d)(5). Asset in question was a commercial warehouse claimed as a homestead under New Mexico statute 42-10-9. I am a judicial lien holder with a lien against the commercial warehouse, warehouse appraised value is $ 55,000, and my lien is for $53,000. I beleive the creditor is trying to claim that my judicial lien is impairing the exemption under 11 USC 522(d)(5). What is creditor up to and what can I say in my objection to Amended Motion To Avoid Judicial Lien, i.e., what is my defense?
Submitted: 6 years ago.
Category: Bankruptcy Law
Expert:  cfortunato replied 6 years ago.

Hi tjog,

Does the debtor (you are the creditor) live in the warehouse?

 

Customer: replied 6 years ago.
Allegedly, although there is no running water nor toilet/sewage disposal system. At the time of the filing, I believe I can prove the creditor did not live there. Since then the creditor has moved in furniture and made the place look like a home yet still no water or sewage. Creditor has parked a 5th wheel travel trailer inside the warehouse and may now be living in the 5th wheel.
Expert:  cfortunato replied 6 years ago.

If the warehouse was claimed as the homestead, and if you can prove that the warehouse was not the homestead at the time of filing - and this should be easy to do - you can claim that the petition was filed fraudulently. This can result in a complete dismissal of the case, or at least a denial of the motion to avoid the lien.

By the way, moving a trailer into the warehouse does not make the warehouse a homestead (the trailer would be the homestead) - even if he had been living in the trailer at the time of filing.

Customer: replied 6 years ago.

Does claiming the exemption under 11 USC 522 (d)(5) under the amended motion to avoid lien have any effect on my judicial lien against the warehouse

Expert:  cfortunato replied 6 years ago.

That statute only protects the first $1075 of the value of the property (plus the additional $10,725 of any unused homestead exemption). The rest of the MV can be turned over to creditors. So the statute has an indirect affect on your lien.

 

 

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