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The following article was authored by  Justin Coke , a Columbia, MO attorney.  More information about Justin and his firm can be found on his website:  He can also be reached by phone at (573) 886-8919.

Their Liens Are Just Scare Tactics

Many personal loan companies like to scare people by taking out liens on their furniture, their TV, even their computer. They do this so people will think that if they stop paying, the sheriff will show up to take their couch. This is simply not true. What a lot of people don’t know is that those liens are essentially worthless. The creditors know their liens won’t hold up, which is why most of the time they couldn’t tell you what they really have a lien on. Ask yourself: did they ask for the serial number on your TV or computer? Did they ask the color of your couch? In most cases, they never ask for these details. If they ever tried to collect the property, how would they know what they had a lien on? The lien is there to scare you into paying on time, not because they want to take your couch.

Bankruptcy Protection

When you file for bankruptcy, the bankruptcy code protects you from these liens. 11 USC § 522(b)(4) gives the list of the property that is protected. The short version is that your clothing, furniture, appliances, medical equipment, toys, rings, along with one computer, one television, and one VCR (or similar device, like a DVD player) are all protected. A simple motion will protect your property and get rid of the lien.
However, there are things that don’t count as household goods. Such items include artwork by someone outside of the debtor’s family, electronic equipment worth more than $500 (aside from the one tv, computer, and VCR), antiques worth more than $500, and jewelry worth more than $500 that isn’t a wedding ring. Riding lawnmowers, cars, and boats, are also not protected. Consult with an attorney to make a final determination of what is or is not protected.

You can get a fresh start

The loan companies know the liens they take out on household goods aren’t worth much, but they do it because it scares people. Loan companies are experts at scaring and confusing their clients into thinking they don’t have any options. But this is simply not true. If debt is starting to weigh you down, talk to a bankruptcy attorney. You will most likely be pleasantly surprised at what they can do to get you a fresh start.