Qualifying for Bankruptcy

Hello, this is Roger Ghai with the Law Offices of Roger Ghai, and I practice bankruptcy law in the Kennesaw, Acworth, Marietta areas. Sometimes clients have questions about whether they still qualify to file for bankruptcy if they have a judgment lien, that is a creditor has already sued them. The court has awarded a judgment on behalf in favor of the creditor. And now that’s pending against you as a potential person who’s going to file a bankruptcy case.
So first of all, yes, the answer is yes, you can still file a bankruptcy case. It’s known in that situation as a judgment creditor. So there are certain procedures that have to be filed if you file a bankruptcy and you want to have that judgment wiped off. First thing is my office would need an actual copy of the judgment. Sometimes you can get that from the courthouse, or if you’ve been garnished, the garnishment papers will show the underlying judgment case number.
And if you have been garnished because of the judgment, then we would want to get a copy of that so that we can notify the attorney for the creditor that you filed for bankruptcy protection, so that we can get all collection activity to stop. So generally speaking, you can go ahead and even if there is a judgment against you that’s already filed no matter how old it is, you can still file a bankruptcy. We can extinguish the judgment, get the debt wiped out. The other type of judgment or lien that we run across in this bankruptcy practice would be what we call a non-purchase money security interest lien. And what that means is let’s say, for example, you have a bunch of collateral. You didn’t finance the collateral with the bank, but you used it. You pledged that collateral to get a loan. Could be one of these smaller loan companies.
And so let’s say you’ve got a sofa, TV, a washer, dryer, microwave, you happen to have needed a loan. And so you went to one of those companies and you got a loan against that property that you owned. We can go ahead, if you file a bankruptcy case, you’re not going to lose that property. We can go ahead and file a motion to avoid that loan, lien technically, as well. And then you will still own all of those items free and clear once the bankruptcy case has concluded. So if you have questions of this nature, whether it’s a judgment that’s against you or a lien that you pledged some collateral for and you obtained the loan call my office at (770) 792-1000.