Does Bankruptcy Automatically Remove Liens and Mortgages?
posted on 1/5/10 in Bankruptcy Myths
No, filing bankruptcy won’t automatically remove a lien or mortgage. Liens can be placed on a debtor’s property in many different ways. Some are by agreements, like mortgages and auto liens. Others are by operation of law, like property tax liens on a debtor’s home. And some liens are to enforce judgments that have been entered against the debtor.
Certain liens can never be removed in a bankruptcy case except by paying the underlying indebtedness, and others can only be removed if special action is taken in the bankruptcy case. So, if a debtor has any question about liens on his or her property, these matters should be discussed with an attorney.
