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JudgmentBuy Article:

Releasing Judgment Liens

One tool in judgment recovery is recording UCC and/or real estate property liens. Even when real estate prices are down, sometimes recording a judgment lien works. When it does work, or your judgment gets satisfied in any other way; all previous judgment-related liens should be removed ASAP. Who is responsible for removing any recorded liens after a judgment is satisfied?

This article is my opinion, and not legal advice. I am a judgment expert, and am not a lawyer. If you ever need any legal advice or a strategy to use, please contact a lawyer.

After a judgment gets satisfied, I strongly encourage every judgment owner to handle things (and if you are recovering someone else's judgment, paying them off soon); and make sure every judgment lien that was recorded against the former judgment debtor gets released. It is certainly legally required; and by doing it yourself, you will insure that it gets done right. You will most likely never have to deal with this kind of future potential problem again.

Judgment-related liens include Secretary Of State (SOS) UCC liens and real estate property liens. The laws about post-judgment recovery describe how judgment liens are obtained and recorded, and often do not say as much about how they are removed and who needs to remove them and when. One potential loophole is: If the debtor pays your judgment off and you remove liens, and that debtor files for bankruptcy protection within 3 months after, you may have to give the money the debtor paid to you, back to the bankruptcy trustee, and have egg on your face.

If a judgment-related UCC lien was issued, you can get a form to release that lien from your (state specific) Secretary Of State's (SOS) website. When you get your release of UCC lien form back from the SOS; make a copy of it, and mail that copy to your former judgment debtor.

When a judgment creditor is paid enough to settle or satisfy their judgment, they should always file a notarized satisfaction of judgment form with the court; make a copy for themselves, and mail the judgment satisfaction with the court's stamp, to the former judgment debtor. If you purchased an abstract of judgment, however you never recorded it at a county recorder; no property lien got attached, and so there is no lien to record again, so you are done.

If any property lien (related to your judgment) was recorded at a county recorder, then buy a certified copy of the satisfaction of judgment from the court. Then record that certified satisfaction of judgment, or a release of lien form, at every county recorder where the judgment-related lien was recorded at, even if your former judgment debtor currently owns no property.

You could mail a certified copy of the satisfaction of judgment to your former judgment debtor, and instruct them to file it at their county recorder. However, if you want something done for sure; either do it yourself, pay someone to do it, or strongly forbid your kids from doing it.

Remove all doubt, and handle this job yourself. Record the certified satisfaction at the county recorder, and then mail a copy of that recorder-endorsed satisfaction to the former judgment debtor. After a judgment gets satisfied, the court stamped satisfaction needs to be mailed to the former judgment debtor anyway; so why not save a stamp and mail them the recorder-stamped certified satisfaction of judgment in the same envelope?

Some States and/or Counties may require a notarized declaration similar to (e.g.):

SUPERIOR COURT OF THE STATE OF CALIFORNIA
COUNTY SANTA CLARA

CHARLES CREDITOR - Plaintiff(s),
v.
DANIEL DEBTOR - Defendant(s)

CASE NUMBER: 123456789

RELEASE OF LIEN

1. On April 11, 2012, a judgment was entered in the County of Santa Clara, Case # 123456789 in the amount of $23,611.14 in favor of the plaintiff.

2. Creditor created a judgment lien on real property by recording an abstract of judgment in the office of the county recorder, Santa Clara County on August 15, 2013, Instrument No: 2012-123456789.

3. The judgment in case # 123456789 was satisfied in full. The creditor hereby fully releases this lien on the real property commonly known as 233 Debtor Lane, Milpitas, CA 95035, and whose legal description is: APN : 123-456-789
Lot Number : 12
Census Tract : 2370.07
Page Grid : 3170-A4
Map Ref: 888881, Abbreviated Description: LOT 25 MAP REF: 123456.

Dated: ____________________

______________________________ CHARLES CREDITOR

Declarations such this must be notarized, the same way that satisfactions of judgment are; and then recorded at every county recorder where a property lien was created.


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