Lien stripping in NC?

[BROKEDED]

Does anyone know if stripping a 2nd mortgage is available in North Carolina? One attorney I talked to said, "No" but she also wouldn't even talk about Chapter 13.

However, while googling the subject, I saw the term, "Lien stripping" mentioned in some supposed NC attorney ads.

I haven't had the time yet to contact those attorneys. My luck so far has only been to talk to paralegals and office assistants over the phone and they all want to set up a consultation.

Anybody have a definitive answer?

[BNKRPTinNC]

My second was not stripped per se but considered unsecured as the tax value was less than what was owed on the first, according to the paperwork I received from the court. Initially I was at 0% to unsecured but recently raised to 13.72%. If you are in or around the Henderson area PM me and I will give you the name of my atty.

[BROKEDED]

Well, my dilemma is this...I owe $150k on the 1st, $105k on the 2nd for a total of $255k. The tax value is $201k. (low) So my tax value is $51k more than the 1st mortgage, but $54k less than what I owe total. The home "might" appraise right now for $220k.

NC homestead exemptions are due to increase to $70k per couple on December 1st but that only applies to Chapter 7, right?

[indebt00]

I thought that your house had to appraise for LESS than your 1st to qualify for a lien strip of the 2nd. Even $1 above makes your 2nd not strippable...or least that is what I thought??

maybe its different in other states??

[BROKEDED]

That's exactly what I'm trying to find out. I've read what you're stating. What I can't seem to find is if any exemptions from Chapter 7 ($70k Homestead) are allowed in Chapter 13.

If so, then basically $150k(1st) + $70k(Exempt)= $220k of the house would be protected.

"IF" that is allowed, my question then would be if the 2nd mortgage could be stripped down to the appraised value (assuming under $220k) or even further down to the tax value of $201k?

[BNKRPTinNC]

Found this

The Law Office of
Susanne M. Robicsek

North Carolina Bankruptcy Homestead Exemption

North Carolina Bankruptcy Lawyer in Charlotte NC for Chapter 7 / Chapter 13


Exemption laws protect some property from being taken by creditors if a person is sued. Exemptions also protect bankruptcy debtors. North Carolina exemptions apply to someone who files bankruptcy in the state of North Carolina, if they have lived in North Carolina for two years or longer. If they have lived in North Carolina less than two years, then either Federal Exemptions of the exemptions of a former state apply.

The North Carolina Laws allow each resident to exempt (protect or withhold) from creditors, up to $18,500.00 in their residence, or in the residence of their dependent. If the debtor does not have a residence or does not need the entire $18,500.00 exemption in the residence, they can use up to $5,000.00 as a wildcard exemption in any type of property to the extent it is not used for the residence.

You can think of the North Carolina homestead exemption a little differently and say that North Carolina has a homestead exemption per person of $13,500.00 in their residence, that can be combined with the $5,000.00 wildcard for a total of $18,500.00 residential homestead exemption.

For example, if a resident claims $16,000.00 equity in their residence as exempt, they would still have up to $2,500.00 wildcard to use elsewhere.

If a debtor in bankruptcy has lived in North Carolina for at least two years, this exemption would likely apply to them in either a Chapter 7, Chapter 11 or Chapter 13 case.

[BROKEDED]

Ya know, I read the first part of that earlier today on her website but I guess my eyes glazed over after reading the part that I already knew about.

Thank you for pointing that out to me!

Now, I just need to find out what, if anything, could be done about the 2nd mortgage in excess of the tax/appraisal value.

[BNKRPTinNC]

As was mentioned by a previous poster that if the first is greater than the appraised value the second can be stripped. Now whether or not tax value is used instead of an appraisal I couldn't say but was in my case.

Verbage from the Court:

"....(the Creditor) is listed as holding a second deed of trust on Debtor's real property commonly known as........("the real property"). The Debtor's property is found to have a value not to exceed $$$$. The Creditor is found to be an unsecured claimant due to no value in the real property to secure the deed of trust held by the Creditor."

So, I can't say for sure whether or not your second would be stripped or just made unsecure with the possibility of paying a percentage back.