Motion to Avoid Lien - California

UNITED STATES BANKRUPTCY COURT

☐ NORTHERN ☐ EASTERN ☐ CENTRAL ☐ SOUTHERN DISTRICT OF CALIFORNIA

DEBTOR'S MOTION TO AVOID [JUDICIAL LIEN / NONPOSSESSORY, NONPURCHASE-MONEY SECURITY INTEREST] UNDER 11 U.S.C. § 522(f)

[DEBTOR NAME] (the "Debtor"), by and through undersigned counsel, respectfully moves this Court, pursuant to 11 U.S.C. § 522(f) and Federal Rules of Bankruptcy Procedure 4003(d) and 9014, for an order avoiding the lien described below to the extent it impairs an exemption to which the Debtor is entitled. In support, the Debtor states:

1. Jurisdiction and Authority

1. This Court has jurisdiction under 28 U.S.C. §§ 157 and 1334. This is a core proceeding under 28 U.S.C. § 157(b)(2)(K).

2. The Debtor filed a voluntary petition under Chapter [____] of Title 11 on [__/__/____].

3. This Motion is brought under 11 U.S.C. § 522(f)(1), which permits a debtor to avoid the fixing of a lien on an interest of the debtor in property to the extent the lien impairs an exemption to which the debtor would have been entitled under 11 U.S.C. § 522(b). Procedure is governed by Fed. R. Bankr. P. 4003(d) and 9014, with service under Fed. R. Bankr. P. 7004.

2. The Lien To Be Avoided

4. The lien the Debtor seeks to avoid is held by the following creditor:

5. The lien is (check one):

☐ A judicial lien under 11 U.S.C. § 522(f)(1)(A), arising from a judgment entered in [COURT NAME], Case No. [____________], on [__/__/____], in the amount of $[____________], and perfected as a lien by recording an Abstract of Judgment with the [COUNTY] County Recorder on [__/__/____] as Instrument/Document No. [____________] (Book [____], Page [____]) (Cal. Code Civ. Proc. § 697.310 et seq.).

☐ A nonpossessory, nonpurchase-money security interest under 11 U.S.C. § 522(f)(1)(B) in household furnishings, household goods, wearing apparel, appliances, books, animals, crops, musical instruments, jewelry, implements, professional books, tools of the trade, or prescribed health aids, created by a security agreement dated [__/__/____] in favor of the creditor.

6. The lien does not secure a domestic support obligation and is therefore not excepted from avoidance under 11 U.S.C. § 522(f)(1)(A)(i)–(ii).

3. The Property

7. The lien attaches to the following property in which the Debtor holds an interest:

4. The Claimed Exemption (California Opt-Out — Two Systems)

8. California has opted out of the federal bankruptcy exemptions of 11 U.S.C. § 522(d). See Cal. Code Civ. Proc. § 703.130. California debtors instead choose between System 1 (the CCP § 704 exemptions, including the § 704.730 homestead) and System 2 (the CCP § 703.140(b) "federal-style" exemptions with a large wildcard). A debtor must elect one system; the elected system determines the exemption used in the § 522(f)(2)(A) impairment calculation. The § 522(f) right to avoid liens applies under either system.

9. The Debtor elected and claimed on Schedule C the following (check the system and basis):

☐ SYSTEM 1 — CCP § 704:

☐ Homestead — Cal. Code Civ. Proc. § 704.730, in the amount of $[____________]. The homestead is the greater of the prior-year countywide median single-family home sale price or the statutory floor, not to exceed the statutory cap. For 2026, the floor is $371,547 and the cap is $743,459, indexed annually to the California CPI — VERIFY the current figures and the controlling county median as of the petition date.

☐ Motor vehicle — § 704.010; ☐ household furnishings/personal effects — § 704.020; ☐ tools of the trade — § 704.060; in the amount of $[____________].

☐ SYSTEM 2 — CCP § 703.140(b):

☐ Homestead — § 703.140(b)(1) (in the amount of $[____________]); ☐ motor vehicle — § 703.140(b)(2); ☐ household goods — § 703.140(b)(3); ☐ tools of trade — § 703.140(b)(6); ☐ wildcard — § 703.140(b)(5) (base amount plus any unused homestead), in the amount of $[____________] — VERIFY current indexed amounts.

☐ Other California exemption — [CITATION], in the amount of $[____________].

10. The exemption was claimed on Schedule C and ☐ has not been objected to / ☐ is the subject of [DESCRIBE]. ☐ An amended Schedule C is filed concurrently.

5. Impairment Under 11 U.S.C. § 522(f)(2)(A)

11. A lien impairs an exemption to the extent that the sum of (i) the lien sought to be avoided, (ii) all other liens on the property, and (iii) the exemption the debtor could claim absent any liens, exceeds the value the debtor's interest in the property would have in the absence of any liens. 11 U.S.C. § 522(f)(2)(A).

12. Applying the formula, the sum on Line D ($[____________]) exceeds the value on Line E ($[____________]). The lien therefore impairs the Debtor's exemption.

6. Extent of Avoidance

13. The lien is avoided as follows (check one):

☐ In its entirety. Because the impairment (Line F) equals or exceeds the amount of the lien (Line A), the lien is wholly avoided.

☐ In part. The lien is avoided in the amount of $[____________], and survives as a lien in the amount of $[____________].

7. Relief Requested

WHEREFORE, the Debtor respectfully requests that the Court:

(a) Enter an order avoiding the lien described above under 11 U.S.C. § 522(f) to the extent it impairs the Debtor's exemption;

(b) Declare the avoided lien void and of no further force or effect against the Debtor and the subject property, and provide that the Debtor or any party in interest may record a certified copy of the order with the [COUNTY] County Recorder to clear title;

(c) Direct the creditor to release the lien of record within [____] days of the order; and

(d) Grant such other relief as is just and proper.

8. Notice and Opportunity to Object

14. NOTICE IS HEREBY GIVEN that any party opposing this Motion must file a written objection or response with the Clerk and serve it on the undersigned within the time prescribed by the applicable Local Bankruptcy Rules and notice procedures.

☐ Pursuant to Local Bankruptcy Rule, you have [____] days from the date of service to file and serve a written objection.

☐ If no objection is timely filed, the Court may grant the relief requested without a hearing.

☐ A hearing is scheduled for [__/__/____] at [____] [a.m./p.m.] before the Honorable [JUDGE NAME], Courtroom [____].

9. Certificate of Service

I certify that on [__/__/____], a true and correct copy of this Motion, supporting papers, and the proposed order was served on the parties below in the manner indicated, including service on the creditor in compliance with Fed. R. Bankr. P. 7004:

Dated: [__/__/____]

[____________________________________]
[ATTORNEY NAME], California State Bar No. [________]
Attorney for Debtor
[FIRM NAME] · [ADDRESS] · [PHONE] · [EMAIL]

PROPOSED ORDER

UNITED STATES BANKRUPTCY COURT

☐ NORTHERN ☐ EASTERN ☐ CENTRAL ☐ SOUTHERN DISTRICT OF CALIFORNIA

ORDER AVOIDING LIEN UNDER 11 U.S.C. § 522(f)

This matter came before the Court on the Debtor's Motion to Avoid Lien under 11 U.S.C. § 522(f). The Court finds that notice was adequate, that no timely objection was filed (or that any objection has been resolved or overruled), and that the lien impairs an exemption to which the Debtor is entitled under the California exemption system elected by the Debtor (California having opted out under CCP § 703.130). Accordingly,

IT IS ORDERED:

1. The Motion is GRANTED.

2. The lien of [CREDITOR NAME] ☐ recorded on [__/__/____] as Instrument/Document No. [____________] (Book [____], Page [____]) with the [COUNTY] County Recorder / ☐ created by security agreement dated [__/__/____], on the property described as [____________________________________], is AVOIDED under 11 U.S.C. § 522(f):

☐ in its entirety; or ☐ in the amount of $[____________], leaving a surviving lien of $[____________].

3. The avoided lien is void and of no further force or effect against the Debtor and the subject property to the extent avoided. A certified copy of this Order may be recorded with the [COUNTY] County Recorder.

4. The creditor shall release the avoided lien of record within [____] days of entry of this Order.

DATED: [__/__/____]

[____________________________________]
United States Bankruptcy Judge

CALIFORNIA PRACTICE NOTES

Opt-out with two systems. California is an opt-out state under CCP § 703.130 — the federal § 522(d) exemptions are unavailable. Debtors choose System 1 (CCP § 704) or System 2 (CCP § 703.140(b)). The choice is all-or-nothing and is critical to the § 522(f) analysis because the exemption "the debtor could claim" (Line C of the formula) differs sharply between the two systems.

System 1 homestead — CCP § 704.730. Since AB 1885 (eff. Jan. 1, 2021), the homestead is the greater of (a) the prior calendar year countywide median single-family home sale price, or (b) the statutory floor, not to exceed the statutory cap. Both floor and cap adjust each January 1 by the California CPI. For 2026 the floor is $371,547 and the cap is $743,459. Always verify the current figures and the controlling county-median number as of the petition date — the statute does not name an authoritative county-median source, so the controlling figure can be contested. The homestead amount and entitlement are generally fixed as of the petition date (snapshot rule; In re Jacobson, 676 F.3d 1193 (9th Cir. 2012)).

System 2 — CCP § 703.140(b). A federal-style set with a modest homestead (§ 703.140(b)(1)) and a large wildcard (§ 703.140(b)(5)) equal to a base amount plus any unused homestead — often the better choice for debtors with little home equity but significant personal property. Vehicle (§ 703.140(b)(2)), household goods (§ 703.140(b)(3)), and tools of trade (§ 703.140(b)(6)) amounts are indexed; verify.

Section 522(f)(1)(B) and household goods. A nonpossessory, nonpurchase-money security interest in the § 522(f)(1)(B) categories is avoidable to the extent it impairs the household-goods/personal-property exemption (System 1 § 704.020 or System 2 § 703.140(b)(3)).

Section 522(f)(2)(A) mechanics. Add the lien to be avoided + all other liens + the exemption the debtor could claim, compared to the value of the debtor's interest absent liens; the excess is the impairment, and the lien is avoided up to that amount. Address multiple judicial liens in inverse order of priority.

Local procedure. California has four districts — Northern (Oakland/San Francisco/San Jose/Santa Rosa), Eastern (Sacramento/Fresno/Modesto), Central (Los Angeles/Riverside/Santa Ana/Woodland Hills/San Fernando Valley), and Southern (San Diego/Santa Ana area as designated). Local practice varies: the Central District (C.D. Cal. LBR 9013-1 and the court's mandatory forms, e.g., the motion-to-avoid-lien form) and other districts have specific motion, notice, and lodged-order requirements. Use the district's mandatory local form for lien-avoidance motions where one exists, and confirm the objection period and hearing requirement. Serve the creditor under Fed. R. Bankr. P. 7004.

Unsettled / verify points. (1) Current § 704.730 floor/cap and the controlling county-median figure (no statutory authoritative source); (2) current indexed § 703.140(b) amounts; (3) whether the district/judge requires a noticed hearing or permits negative notice, and the applicable mandatory local form; (4) 11 U.S.C. § 522(b)(3)(A) and § 522(p)/(q) caps where domicile or recently acquired equity is at issue.

SOURCES AND REFERENCES

• 11 U.S.C. § 522(f), (f)(2)(A) (lien avoidance; impairment formula).
• Fed. R. Bankr. P. 4003(d), 9014, 7004.
• Cal. Code Civ. Proc. § 703.130 (opt-out).
• Cal. Code Civ. Proc. § 703.140(b) (System 2 exemptions).
• Cal. Code Civ. Proc. § 704.730 (homestead; floor/cap; CPI adjustment) — 2026 floor $371,547 / cap $743,459.
• Cal. Code Civ. Proc. §§ 704.010, 704.020, 704.060 (vehicle, household items, tools).
• Cal. Code Civ. Proc. § 697.310 et seq. (abstract of judgment lien).
• AB 1885 (2020 Cal. Stat. ch. 94) (homestead floor/cap and CPI escalator).
• In re Jacobson, 676 F.3d 1193 (9th Cir. 2012) (petition-date snapshot).
• United States Bankruptcy Courts for the N.D./E.D./C.D./S.D. Cal. — Local Bankruptcy Rules (e.g., cacb.uscourts.gov).