Stripping 2nd and 3rd

[cc8225]

I took the first step and made an appointment with a bk lawyer (11/9/09). I have three mortgages, a first Mortgage of 295,000 a second for 70,000, and a third for 58,000. My total mortgage payment is 3100 a month. My home is valued between350,000-370,000. I have approximately 60k in unsecured debt. Is it possible to strip the second and the third? or maybe just the third? I am in Md. my salary is 73,000 and with overtime i have made 91k so far this year. (overtime is currently being reduced) I have a wife and three kids. Thanks.

[OhioFiler]

Didn't we cover this for you in a thread last week? Has anything changed in your situation?

You can lien strip in a Chapter 13 not a Chapter 7.

[cc8225]

Sorry, I was confused about how the value of the home comes into play. I owe 295K on the first, i thought that if the home appraised higher then 295K i would be ineligible. Sorry very stressed and confused.

[HHM]

Based on your numbers, you could probably strip the 3rd, but not the second.

What are you basing your home value on; get a current market analysis (not an appraisal) from a real estate agent. The target value is one that would practically guarantee that house would sell in 30 days. My guess is, that number will be lower than the value you have estimated.

[cc8225]

Thanks for the info, looking forward to meeting my lawyer and moving on.. Good luck.

[cc8225]

Lien Stripping

Update: Got my house appraised yesterday, the value came in at 285,000. We were very surprised and excited, we owe 295,000 on the first. What are the chances of the 2nd and 3rd challenging this appraisal?
My second is with Wells Fargo and the third is with NFCU. Is this automatically stripped if it is not challenged? Will the 2nd and 3rd get any money in the 13 plan?

Thanks.

[HHM]

Unlikely the 3rd mortgage would challenge, it is possible the 2nd mortgage could challenge because the numbers are close. As for the mechanism of stripping the mortgage, that will depend on the district, some allow you simply to put it in the plan, most require you to file a Motion to Value. But, is the lender does not challenge the motion, the court will grant it.

The mortgages become unsecured debts in your chapter 13 plan, thus, if there is a dividend to unsecured creditors in your chapter 13, they will receive some money. Also, you will likely be required to provide what is knowns as an Adequate protection payment (it is very small).

[cc8225]

Great, thanks HHM