Are Mechanic’s Liens Dischargeable in Bankruptcy?
Mechanic’s liens are dischargeable in bankruptcy only under certain circumstances. If the lien has not been perfected (properly recorded), it is considered unsecured debt and may be dischargeable in a Chapter 7 bankruptcy.
If the lien has been perfected, it cannot be removed through a simple Chapter 7 bankruptcy. By filing for Chapter 13 bankruptcy, you can restructure your debt to the lien holder and pay it off, along with other debts, over a three- to five-year payment plan.
It is important to know what liens exist on your property after filing for bankruptcy. If you try to sell the house later, and it has a lien on it, the lien may have survived the discharge and you will not be able to transfer title to the new owner without making the payments.
For a free initial consultation about filing for bankruptcy with Simon Resnik Hayes LLP, call 888.368.4099 or contact us online. Our offices are open weekdays from 7:00 a.m. to 7:00 p.m., and we serve clients in the Los Angeles area and San Fernando Valley through offices in Sherman Oaks and Los Angeles.
Se habla español
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.