You are here:

Bankruptcy Law/lien avoidance ch7

Advertisement

Expert: Mark J. Markus- California Bankruptcy Attorney - 8/27/2009


Question
I am a new atty and have a ch 7 case where the first mortgage equals or exceeds the value of the real property.  There is also a judgement lien that holds second lien position.  If there was equity, I believe that I could avoid the Judgement lien, but does it impair the exemption?  Do you think that I can still avoid the lien, my client wants to keep the house and pay the mortgage.  Thanks.

Answer
The answer differs depending on the circuit your case is filed in and the exemptions laws which apply in your case.  I have successfully argued that there does not need to be equity in order for the exemption to be impaired.  One thing I believe is required is that you have to actually TAKE the exemption in Schedule "C" even if there is no equity.

There is a line of cases on this, at least in the 9th circuit.  Just research 522(f) and "no equity".   See for example,  In re Higgins, 201 B.R. 965 (9th Cir. BAP 1996).

http://www.bklaw.com/

Bankruptcy Law

All Answers

Answers by Expert:

Ask Experts

Volunteer

Mark J. Markus- California Bankruptcy Attorney

Expertise

Mark J. Markus is a Los Angeles bankruptcy attorney who has practiced exclusively bankruptcy law in California since 1991 and is rated A+ by the Better Business Bureau and is AV-rated by Martindale-Hubbell. He represents debtors, creditors, and Trustees in Chapter 7, Chapter 11, and Chapter 13 of the bankruptcy code throughout California.

Experience

Visit our California bankruptcy webpage at http://www.bklaw.com for more information on bankruptcy in general and Mark J. Markus in particular. Many questions are answered on the web page (hint, hint).
The Markus webpage also contains more information on

  • Which Chapter to File,
  • business bankruptcy,
  • chapter 7 bankruptcy,
  • chapter 11 bankruptcy,
  • chapter 13 bankruptcy,
  • Do You Need a Lawyer to File Bankruptcy?
  • Frequently Asked Bankruptcy Questions

    Also visit our Los Angeles bankruptcy blog for interesting articles and much more.



    Organizations
    Central District Consumer Bankruptcy Attorneys Association (CDCBAA) Los Angeles County Bar Association (LACBA) Commercial Law & Bankruptcy Section of the Los Angeles County Bar Association Financial Lawyers Conference (FLC) National Association of Consumer Bankruptcy Attorneys (NACBA) Los Angeles Bankruptcy Forum (LABF) American Bankruptcy Institute (ABI) San Fernando Valley Bar Association (SFVBA)

    Publications
    Central District Consumer Bankruptcy Attorneys Association Newsletter September 2007 (Vol. 1, Issue 2)

    Education/Credentials
    J.D., University of Arizona 1990. B.A. Economics, California State University, Northridge 1986. For more details please click here

    Awards and Honors
    AV Rated by Martindale-Hubbell (http://www.martindale.com) A+ Rated by Better Business Bureau

    • ©2012 About.com, a part of The New York Times Company. All rights reserved.