Bankruptcy Law Questions? Ask a Bankruptcy Lawyer.
If you have a second mortgage on your house, and the value of the residence is less than the balance due on the first mortgage, you can strip off the second mortgage and treat it as an unsecured claim. However, you can only do a second mortgage strip off if there is not one single dollar of house value to "secure" it, and you stay in your Chapter 13 until its completion.
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I was thinking of chapter 7 bankruptcy. I want to continue to pay on my first mortg. and not include that in the bankruptcy, only include the second mortgage. Can I do that?
The mortgage stiff off to my knowledge in only currently available under chapet 13 and even then only under the circumstances as stated above, There is a bill that broadened these powers that passed the House but it has not yet passed the Senate as of March 09.
Since the second mortgage is secured by the home, I doubt it could be eliminated in a chp 7 if it can barely be eliminated in a chp 13.