Sued and have a Judgment Against You? Bankruptcy may be the Answer

You may be able to discharge (get rid of) a judgment in a bankruptcy. It will depend on the underlying nature of the judgment, or what you actually got sued for. While most judgments can be taken care of by bankruptcy, some debts, by their very nature, are non- dischargeable debts. That is the exception rather than the rule and in my experience, most people have no problem eliminating judgments in their bankruptcies. Many bankruptcy filers seeking to discharge a judgment were sued for credit card debt or medical bills or other dischargeable debts. A word of caution: while your personal liability for a judgment may be discharged in a Chapter 7, if a lien exists as a result of the judgment, that lien might survive the bankruptcy. For example, someone who has a judgment against you may have taken an additional step to get a lien put on your house. This is a discussion that you need to have with your bankruptcy lawyer to find out if there is a way to “avoid the lien”. This is where it can get really tricky as different individual circumstances play into it and “lien avoidance” needs to be specifically requested.

Remember, even debts that should be dischargeable may not be if your trustee or creditor has a valid reason to object during the course of your bankruptcy and takes the proper procedures in court, where a judge will decide on the validity of the objection (for example, if a creditor suspects fraud).

Bankruptcy law is full of complexities. If you are considering filing, don’t do it alone. Mistakes usually end up costing people dearly. Be sure to claim your free copy of our book “Bankruptcy Myths Exposed” or if you are ready to speak to an attorney, contact our office at 630 250-8813 for a free consultation. 

Carol O'Connor Cadiz
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Attorney & Owner at O'Connor Cadiz Law: Bankruptcy, Injury, Real Estate & Mediation