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If you have unsecured debt of under $10,000 and live in the Province of Ontario filing bankruptcy may not be the best option for you. We suggest you contact the Office of the Superintendent of Bankruptcy at 416-973-6441 to discuss your options, or you can visit their website here.

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Bankruptcy & Lien on home

If a person is sued by a bank for an amount owing on an unsecured line of credit and the bank then places a lien on the person’s home, will declaring bankruptcy remove the lien or will the bank still be able to take the house?

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One Response to “Bankruptcy & Lien on home”

A licensed trustee said...

A lien is just like a mortgage; it is not automatically removed in a bankruptcy. Once a lien is in place, it will only be removed if you repay the debt, or if the house is sold, or if the bank for some reason agrees to remove the lien.

It may be possible to have a lien removed as a condition of a proposal, but this is a complicated area and a consultation with a trustee would be necessary.