It depends. If you have a judgement, the underlying debt may be discharged so your judgement can be meaningless. However, if there is an asset Chapter 7 or debtor files a Chapter 13, your lien entitles you to priority over certain types of creditors. Moreover, if you have a special kind of debt that is not dischargeable, plus a lien, you are placed in a stronger position to collect in the future.

If you have a valid purchase money security - for example, you sell your business to a buyer and have a lien against the business, you are secured creditor. Your lien against the business still remains intact through bankruptcy. The debtor will have to decide whether she’s going to retain (and pay on the lien) or surrender.

Posted in: Creditor Rights in Bankruptcy