Lien avoidance in Utah is a procedure in which you ask the bankruptcy court to reduce the amount owed or avoid a lien on property. The amount of the lien that can be avoided depends on the value of the property and the amount of the exemption. Generally, if the property is worth less than the exempt amount, then the lien will be avoided; or if the property is worth more than the exempt amount, than the lien will be reduced to the difference between the value of the property less the claimed exemption.
Generally, only non-consensual liens can be avoided in a Chapter 7 Bankruptcy. There are some circumstances where a consensual lien can be avoided, but you should consult with a bankruptcy expert in your area to determine if your consensual liens can be avoided.
A creditor in Utah may in some circumstances get a lien on your property without your consent (also known as a non-consensual lien). A non-consensual lien can give the creditor the right to force the sale of the property or wait until you sale the property to get paid. There are three basic types of non-consensual liens:
- Tax Lien: Federal, State, and local government entities have the authority to file a lien on your property if you owe delinquent taxes.
- Judicial Liens: A judicial lien is levied against your property once someone has sued you and received a monetary judgment.
- Statutory Liens: Some liens are created automatically by law (eg: in most states, if you hire someone to work on your home, the worker who supplied the materials automatically has a mechanic’s lien on your home if you do not pay).
To find out if you have liens that can be avoided or reduced in a Chapter 7 Bankruptcy in Utah, contact us by Phone at 866-297-3883 or email at info@shortsaleadvocate.cc.