Judicial Liens

• Creditors can enforce a judgment by placing a lien on the debtor's property. Once the judicial lien is properly recorded, the creditor will receive payment for the judgment from the sale proceeds of the property. Sometimes, the debtor will not be able to sell the property until the debt is paid off and the lien is removed. If there is a judicial lien on the debtor's property, the creditor's interest in the property must be stated in the bankruptcy petition. List a description of the property, the creditor's information and the judgment amount in the appropriate Schedule A, Schedule B or Schedule D of the petition, if applicable. The petition and instructions for filling out the schedules are available in the Bankruptcy Forms section of the U.S. Courts website.
  
  

Unsecured Priority Claims

• Judgments issued for delinquent child support payments and certain types of tax debts are among the claims that are not discharged in a bankruptcy case. The debtor needs to keep making those payments until the full financial obligation has been satisfied. The Schedule E form states the type of debts that should be included in that section of the bankruptcy petition. Provide the account or case number for the debt, the amount of the debt, and also state if the judgment is being disputed. The bankruptcy trustee may request copies of the court orders for the unsecured priority debt judgments.
  
  

Unsecured Nonpriority Claims

• Paying the claims of unsecured nonpriority creditors is not considered a priority in the bankruptcy court. Judgments that fit within this classification are listed in Schedule F of the petition. The types of debts that fit within this category include deficiency judgments for repossessed property, credit cards, payday loans, and medical expenses. Typically, these are the claims that are discharged once the bankruptcy case is completed. Chapter 13 debtors only have to pay unsecured nonpriority claims if they have enough disposable income to do so. Otherwise, it is not required.
  
  

Chapter 13 Cases

• When the debtor files a Chapter 13 bankruptcy case, the nondischargeable judgments must be among the debts that will be paid in the Chapter 13 plan. Those debts include the unsecured priority claims and the judicial liens. If the debtor plans on avoiding a judicial lien based on applicable bankruptcy provisions, that intention should be stated in the Chapter 13 plan. Any attempts to avoid a judicial lien and reclassify the debt must be approved by the bankruptcy court.