I have judgment against defaulting tenant and recorded abstract of judgment. 6 months later tenant filed bankruptcy. Am I a secured creditor?
Get Legal Help Today
Compare Quotes From Top Companies and Save
Secured with SHA-256 Encryption
I have judgment against defaulting tenant and recorded abstract of judgment. 6 months later tenant filed bankruptcy. Am I a secured creditor?
Can my judgment be discharged by bankrupcy court?
Asked on June 12, 2009 under Bankruptcy Law, California
Answers:
M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney
Answered 15 years ago | Contributor
You are not a secured creditor. A secured creditor is a creditor having a claim that is protected by specific assets. For example, the owner of a mortgage can force the sale of or can take possession of the real estate that is mortgaged if the borrower fails to meet the terms of the lending agreement.
You are an unsecured creditor whether or not you filed an abstract of judgement. The act of recording does not give you a security interest. Again, there must be a specific asset involved like a car or the previously mentioned mortgaged property.
As to your judgement surviving bankruptcy, if its a Chapter 7, then the Chapter 7 will generally eliminate all unsecured debts, including yours. In a Chapter 13 case, the debtor pays all or only a portion of their debts, depending on how much disposable income they have each month. So if your former tenant files a Chapter13, you stand to get at least some of the money that you are owed.
Note: If a Chapter 13 is filed, and you are not paid all of the money that you are owed, then at the completion of the bankruptcy the rest of your tenant's debt to you will be discharged; they will no longer owe you any money. What, if anything, you receive during the bankruptcy is all that you are legally entitled to.
IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.