Lien Strip on the 2nd Mortgage

[thomasj]

Im considering talking to my Atty tomorrow about the Lien Strip on my Second mortgage. Has anyone in the forum ever done this? What should i know about this type of action? What type of questions should i ask my Atty? I need more information on this so i dont sound like im reaching.

Currently I owe 450K ($75k on 2nd and $375K on the first ) and it's worth 250k to 270k on my Condo. Im going to try and keep the Condo. 2nd got charged off in Jan 2008 during the BK.

Please help

[HHM]

That is quite a bit of depreciation. (or you made a lousy deal when you bought the thing). As bad as the real estate market is, I have difficulty believing you have a 55% decline in value, but I suppose anything is possible.

In any event, you CAN do a lien strip, but you CAN ONLY do it in a chapter 13, and there must be no value in the real property that secures the 2nd mortgage. Thus, the property must be worth less than what is owed on the 1st mortgage.