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Liens and Bankruptcy
Originating with the Latin word ligamen, which means "to bind," a lien is a security interest granted over an item of property to secure the payment of a debt or other obligation. Considering the root word, these serious legal financial instruments require a great deal of cooperation between the two parties.
With this being the case, liens are both a major obstacle and a vital aspect of an Ohio or Kentucky bankruptcy filing. It is in your best interests to work with a bankruptcy attorney and see if you are eligible to avoid liens that would otherwise encumber the bankruptcy process.
People experiencing bankruptcy should have the goal of having their debts relieved. Knowing exactly how to approach the issue of liens will allow you to develop a strategy that effectively helps you protect your assets and keep predatory lenders and creditors from harassing you. Having a bankruptcy attorney at your side helping you through this process will make identifying liens and finding solutions to your debt problems much easier, allowing you to focus on getting your affairs in order and move forward.
Bankruptcy Liens in Greater Cincinnati and Northern Kentucky
A bankruptcy filing has the potential to make your head spin. With all the factors that you have to take into account, it may seem like a scenario that you never even want to approach. This mindset of staying away from a process because it is intimidating can lead to disastrous implications regarding your financial well-being.
Eric Steiden has spent the past 25 years and 6,000 case hearings helping Ohio and Kentucky families, businesses and individuals get out from under the mountain of debt and receive a new lease on life. He is dedicated to making certain that his clients immediately have peace of mind knowing that an experienced legal team is taking care of everything, even if complex liens are involved. This focus on the best interests of his clients has allowed him to successfully handle many bankruptcy cases, from the beginning of the process until the end.
Steiden Law Offices has two office locations in Cincinnati that cater to individuals and businesses throughout Hamilton County, Ohio. This includes the cities of Norwood, Forest Park, Blue Ash, Montgomery, Reading, Springdale, North College Hill, Harrison, Madeira and many more.
In addition to their two Cincinnati, Ohio locations, Steiden Law Offices has two Kentucky offices, one in Florence and the other in Covington. Along with serving the residents of these two great cities, Eric and staff also proudly represent those dealing with debt issues in Erlanger, Edgewood, Elsmere, Villa Hills, Fort Mitchell, Taylor Mill, Fort Wright, Ludlow and many more.
To set up a time to speak with Eric and staff in the form of a free legal consultation to go over your Kentucky or Ohio bankruptcy, call (888) 877-3328 or send an online message today.
Lien and Bankruptcy Information Center
- What is a Lien?
- Lien Procedure and Placing or Removing Liens
- Avoiding Liens in Bankruptcy
- Resources for Liens and Bankruptcy
A lien is considered a legal claim against something that you own, whether it be personal or real property. They are sometimes called "security interests" and are based off the collateral that the individual or business is an owner of. Collateral could include houses or cars that are currently under mortgage or loan from a financial institution.
If you do not make the required loan payments, most liens allow the lender (bank) to sell the collateral after a process that requires them to follow specific rules regarding documentation, timing and notice. Mortgages and car loans are the most common types, but there are also certain liens that are termed "involuntary liens" which include, among others:
- Home liens
- Tax liens
- Court judgments
- Mechanic's liens (also known as Construction liens)
- Attorney liens
- Homeowners association or condominium liens
From what the name implies, these involuntary liens will be imposed even if you do not want them. Liens are produced with the assumption that they will keep a borrower from selling property, or at least prevent them from transferring the title to the property until the debt or obligation is satisfied.
Lien Procedure and Placing or Removing Liens
Sometimes, property that carries a lien can be forced into sale by the lender to collect what is owed, if the loan is in default. If the borrower decides to sell the property, the lien holder must be paid before the title will be cleared for transfer to the buyer. In some cases, the lien holder is permitted to take possession of the property until the debt or obligation is satisfied but cannot sell it.
Liens might be agreed to by the debtors, or they might be imposed upon debtors through legal means. To place a lien on property, the person or entity that is owed money or services typically must go through the appropriate government office and pay a fee. The debtor usually can remove the lien by satisfying the original debt, repaying the fee that was charged when the lien was placed and paying an additional fee to have it removed.
Liens have a tendency to live past a bankruptcy filing. Even so, it is vital that you identify any such liens before filing for bankruptcy so that your attorney can analyze whether the lien can be avoided during the process.
One of the most effective ways of getting a fresh start is to attempt to avoid certain liens on your assets. The ability to avoid liens changes the general bankruptcy rule that liens pass through bankruptcy without being affected by the discharge. Meaning that, unless the liens are avoided, the discharge only removes the personal liability of the debtor, not the liability of property that is still subject to what is called a pre-petition lien.
The types of liens that are eligible to be avoided are liens that "impair exemptions." Liens that attach to assets which the debtor is entitled to claim as exempt, can be avoided to the extent the lien eats into the value of the exemption in both Ch. 7 and Ch. 13.
To be avoidable, the lien must be a judicial lien (such as a judgment or a garnishment), or a non-possessory, non purchase money security interest in household items or important items for your job.
Tax liens, considered statutory liens, are unavoidable in Chapter 7, even if they impair the exemptions in the filing. Tax liens can be avoided in Chapter 13 as long as the lien is greater than the asset's actual value.
Resources for Liens and Bankruptcy
United States Court – Bankruptcy – This is the main website for the United States Courts regarding bankruptcy. It offers information on the process, relevant forms, types of bankruptcy, rules, resources and administrators.
Internal Revenue Service – Liens – This page is part of the IRS website and contains information on liens, particularly federal tax liens. It highlights how to get rid of a lien, how a lien affects you, how to avoid a lien and what the differences are between a lien and a levy.
Ohio Revised Codes – Liens – This is a link to the definitions and outlines of liens in the state of Ohio. It offers information on all relevant terms, along with the rules that apply to liens in the state. The particular Chapter for liens within the Ohio Revised Code is 1311.
Steiden Law Offices | Bankruptcy Liens in Covington, KY
When you add an extra variable to bankruptcy, such as a lien, the procedure becomes even more complex. This is why having a capable bankruptcy attorney representing you is of such great importance. Finding ways to avoid liens during the bankruptcy filing, or simply to make certain that the current liens do not ruin your chances for a successful filing, will allow you to be sure that you are doing everything in your power to keep your assets and move on with your life.
Eric Steiden is an Ohio and Kentucky bankruptcy attorney who has a great deal of experience working with individuals who are in need of legal counsel that can effectively handle their bankruptcy filing. He and his staff of attorneys are well versed in how liens relate to bankruptcy and will take every measure necessary to keep your liens from encumbering your ability to move forward.
Steiden Law Offices is committed to the clients they serve and will always abide by the values of integrity and honesty while representing you. This strict adherence to playing by the rules has garnered the law firm a trustworthy name amongst the bankruptcy courts and legal community. The law firm has never once had an unsuccesful case audit, a point of pride that cannot be claimed by all Cincinnati, Florence or Covington law firms.
To schedule a free consultation to see if you are eligible for bankruptcy protection, call (888) 877-3328 or send an online message today. With offices in Cincinnati, Florence and Covington, Eric proudly represents individuals throughout both Northern Kentucky and Southern Ohio, including Hamilton County, Boone County and Kenton County.
