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Ask WALLSTREETESQ Your Own Question
WALLSTREETESQ
WALLSTREETESQ, Attorney
Category: Bankruptcy Law
Satisfied Customers: 17211
Experience:  14 years exp., CH 7 AND 13 Bankruptcy cases, AFL-CIO UNION PLUS, UFT NYSID AND ALL MAJOR UNIONS
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Im in bankruptcy chapter.13 my home equity line of credit is secured now. there is

Customer Question

I'm in bankruptcy chapter.13 my home equity line of credit is secured now. there is no equity .can we fill to make it unsecured creditor?
Submitted: 4 years ago.
Category: Bankruptcy Law
Expert:  WALLSTREETESQ replied 4 years ago.

WALLSTREETESQ :

Hello I am a licensed attorney here to help you with your question, please review my response and do not hesitate to ask for clarificati on

WALLSTREETESQ :

If your home is underwater, and the second loan is 100% unsecured, you can list the equity loan as an unsecured creditor in your chapter 13, this is called lien stripping.

WALLSTREETESQ :

For example if your first mortgage is $100,000 and the home is worth $90,000 and you have a $100,000 equity loan,

WALLSTREETESQ :

the second is 100% unsecured,

WALLSTREETESQ :

However, if the home is worth $110,000

WALLSTREETESQ :

the $10,000 would not allow you to lien strip, as it their is equity