<\/span><\/h3>\nLien stripping is available only for junior mortgages, which means any mortgage that is recorded after the first mortgage has been recorded. The value of the home has to be less than the amount owing on the senior mortgage(s). This is what they mean when they say you are “upside down” on your mortgage.<\/p>\n
If the value of the house is less than the amount owed on the first mortgage, then a motion can be filed in the bankruptcy court to remove the junior mortgages from the property. Once a junior mortgage is removed, it is no longer a lien against the house. All amounts owed on the junior mortgage become an unsecured claim in Chapter 13.<\/p>\n
If the Chapter 13 is successfully completed, the unpaid balance owed on the junior mortgage is eliminated. This is obviously a powerful tool. It can be used to eliminate second and third mortgage amounts owing on someone’s personal residence by hundreds of thousands of dollars.<\/p>\n
A lawyer at Phoenix Fresh Start Bankruptcy Attorneys can explain to you in more detail how lien stripping works and whether lien stripping might be a tool available for you to use to reduce your junior mortgage debt in a Chapter 13 bankruptcy.<\/p>\n","protected":false},"excerpt":{"rendered":"
Below is the third installment of a three-part series dealing with typical questions that our Phoenix clients may have regarding Chapter 13 bankruptcy. Can Chapter 13 Reduce my Mortgage Loan or House Payments? Chapter 13 in and of itself will not lower your monthly mortgage payment. The judge is not going to assess whether you can afford your mortgage and make changes to it; however, if your home is worth less than what you owe on your first mortgage, you […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"_links":{"self":[{"href":"https:\/\/phoenixfreshstartbankruptcy.com\/wp-json\/wp\/v2\/posts\/2495"}],"collection":[{"href":"https:\/\/phoenixfreshstartbankruptcy.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/phoenixfreshstartbankruptcy.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/phoenixfreshstartbankruptcy.com\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/phoenixfreshstartbankruptcy.com\/wp-json\/wp\/v2\/comments?post=2495"}],"version-history":[{"count":0,"href":"https:\/\/phoenixfreshstartbankruptcy.com\/wp-json\/wp\/v2\/posts\/2495\/revisions"}],"wp:attachment":[{"href":"https:\/\/phoenixfreshstartbankruptcy.com\/wp-json\/wp\/v2\/media?parent=2495"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/phoenixfreshstartbankruptcy.com\/wp-json\/wp\/v2\/categories?post=2495"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/phoenixfreshstartbankruptcy.com\/wp-json\/wp\/v2\/tags?post=2495"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}