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Chapter 7 - Notice of Abandonment

Basking Ridge, NJ |

How likely will secured creditors object to the trustee's request to abandon the property?
What happens to judgements not recorded as liens against the property?

Attorney Answers 4

Posted

You need to ask your bankruptcy attorney about this. Most creditors will not object. Any liens remain on the property, but could be removed in a state proceeding. The lien can also be extinguished by the bankruptcy court.

Good luck.

MARY TOM, ESQ.
HUNZIKER, JONES & SWEENEY, P.A.
Wayne Plaza II
155 Route 46 West
Wayne, NJ 07470
Phone No. (973) 256-0456
Fax No. (973) 256-4784

This message does not constitute legal advice and is for informational purposes only. This message does not establish an attorney-client relationship, which can only be established once a retainer agreement has been fully executed between you and this firm. For legal advice, please contact and retain an attorney of your own choosing.

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Posted

Generally, a trustee will abandon property which has no significant value to the creditors. I cannot speak to the likelihood of whether creditors will object, but they certainly have the right to do so if they feel differently.

As far as judgments go, I list all judgments on Schedule F and send additional notices to creditors attorneys. These judgments are generally discharged in bankruptcy.

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3 comments

Asker

Posted

It is an IRS tax lien

Demetri A. Braynin

Demetri A. Braynin

Posted

If the IRS placed a federal tax lien on your property before you filed for bankruptcy, it will remain after discharge. Please note that if you will ever decide to sell your property, it will be necessary to clear the title by paying off the lien before the sale.

Asker

Posted

What will happen to the tax lien if the bank foreclosures?

Posted

The trustee abandonment has nothing to do with the creditors and their liens. It just means that the trustee will not administer the property on behalf of the bankruptcy estate. Judgments are discharged. If they are not recorded as liens, they cannot be recorded after the petition date.

Mr. Goldstein is a Virginia-licensed attorney only. The information is not, nor is it intended to be, legal advice. You should consult an attorney for individual advice regarding your own situation. Answering this question does not in any way constitute legal representation. Contacting Mitchell Goldstein or the Goldstein Law Group does not constitute legal representation, nor is any information you provide protected by attorney-client privilege until otherwise advised.

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Posted

In New Jersey, the Chapter 7 Trusteee has a right to abandon the any property (real or personal) that is part of the estate. A secured creditor will most likely not object to the abandonment as they still have the right to foreclose on the property once it is abandoned. The filing acts as a stay and no one may enter a judgement or record one for a pre-petition debt. Your bankruptcy counsel should be telling all this to you.

The previous information is solely for informational purposes only. If you have further questions, please contact an attorney in your area for more specific answers. Responding to your question in no way creates an attorney/client relationship, and none of the specific guarantees of privacy exist. If you have found this information helpful, kindly check the "helpful" box.

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