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  1. #1
    Join Date
    May 2017

    Default Is a Loan with a UCC-1 Lien Dischargable in Chapter 13

    My question involves bankruptcy in the state of: NH

    Is a loan with a UCC-1 Lien dischargable in Chapter 13? I had a new steel roof put on my house about 2 years ago. The loan was through a finace company. I owe about 17,000 and am filing chapter 13 at the beginning of next month. I am about 2 months behind on the loan payments ($600) and they sent a letter saying they put a Lien against the products I purchased to improve my home (the roof) in the form of a UCC-1 Lien. It says the lien may prevent the sale or refiance of my home. Will this be dischargable, or considered a secured loan that I have to continue making the payments on? By the way, I did leave my lawyer a message asking about this but he hasn't gotten back to me...

    Thank you in advance!

  2. #2
    Join Date
    Oct 2014

    Default Re: Is a Loan with a Ucc-1 Lien Dischargable in Chapter 13

    The phrase "UCC-1" refers to the form commonly used in many states to record a security agreement giving the lender a secured interest in personal property. If the UCC-1 and security agreement are properly filed the lender gets a perfected lien in the described property of the debtor. Absent fraud, a loan for the goods used to improve your roof would generally be dischargeable in bankruptcy. A discharge simply means you no longer have any personal liability for the debt. It does not itself erase liens attaching to the property of the debtor. That said, there are other things that might be done to deal with the lien in the bankruptcy. You'll need to discuss that with your lawyer.

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