Q: I have a judgment, possibly a lien on my home from a credit card company. If I decide to file bankruptcy,what happens?

A: First, check with the Register of Deeds in your county to see whether a lien has been filed against your home. A great deal turns on whether you have a mortgage, as the mortgagee has a lien superior to anything the credit card company may have. If so, check the balance due on the mortgage against the appraised value of your house. New Hampshire has a homestead exemption of $120,000 for a person filing singly and $240,000 for a couple filing jointly.

As I have no solid facts to go on, I can only pose a hypothesis. If your house is valued at $300,000 and your mortgage is $200,000, your equity in the house - the difference between the appraised value and the mortgage - is $100,000. That is less than $120,000 and hence your house cannot be seized by the credit card company. If you file for Chapter 7 bankruptcy (a simple or liquidation bankruptcy), assuming this hypothesis, you will not lose your house. Please remember that even if you don't lose your house, the fact that you filed a bankruptcy petition will remain in your credit history for seven years.

A: Judgments, when final, generally become liens against the debtor's real estate located in that state.

If a bankruptcy case is filed withn ninety days of the judgment's becoming a lien on the real estate, it may be voided in bankruptcy as a preferential transfer.

If it's too late for that, and you file a Chapter 7 case, you cannot "strip" the lien (the Dewsnup case).

If you file a Ch. 13 case, and there is equity value above the first mortgage balance to any extent, a US Supreme Court Case (thanks, Clarence Thomas) says that the debtor cannot remove the judgment lien.

Otherwise, I agree with my colleague's opinion.

A: What happens depends upon which chapter bankruptcy you file--most likely 7 or 13 and when you file. Certain liens and judgments can be voided under the Bankruptcy Code, e.g., 11 USC 522 (f). Section 522(f) allows a debtor “to avoid or ‘wipe out’ a valid

perfected lien or interest that a creditor has in particular property.” In re Scannell, 453 B.R. 36, 39 (Bankr. D.N.H. 2011) (citation omitted). The purpose of a motion to avoid lien is “to enhance [a debtor’s] fresh start by eliminating an otherwise valid judicial lien.” Id. at 41 (citing In re W.K. Montgomery, 80 B.R. 385, 387 (Bankr. W.D. Tex. 1987)). “[T]he extent to which a lien may be avoided may be easily computed once four variables are determined: (1) the amount of the lien in question; (2) the sum of all other liens on the property; (3) the amount of the debtor’s exemption; and (4) the value of the subject property.” In re Dore, 1999 BNH 028, 3. See also 11 USC 544.

Do not wait any longer to deal with this; time is of the essence. Get an experienced Bankruptcy attorney right away and he/she will study your specific situation and make the best recommendation for you.