Lien Strip and discharge

[bksmith12345]

We are lien striping our second mortgage.

When our plan is over and we are discharged what happens with the second?

Does the lien holder release the lien and it just goes bye bye?

Very curious.

Thanks.

[HHM]

That is the $64,000 question. Since very few people have actually gone to completion and stripped the lien. There are 2 ways this will probably go down

1. The lender simply releases the lien and sends a notice to the county recorders office(however, I wouldn't count on on them doing the work to do this), OR
2. You send your discharge notice to the counter recorders office and they remove they lien.

[bksmith12345]

So either way once we are discharged the lien will be released and the only lien we will have is the first?

[pcn]

Isn't there a "value to ...." motion that is filed at some point? What is that exactly? And one atty we talked to told us the lien holder can wait until the very end to fight the strip. None of the others we've talked to have said anything about that.

[bksmith12345]

Isn't there a "value to ...." motion that is filed at some point? What is that exactly? And on atty we talked to told us the lien holder can wait until the very end to fight the strip. None of the others we've talked to have said anything about that.

Yeah what is that. My attorney never said anything about them coming back at the end. He just said it would get stripped.

If they came back at the end to fight could they even win?

If they did win that would be disasteriss. All those payments would be due and interest, etc.

Has anyone hear ever done or seen a sucessfull lien strip?

[HHM]

The motion to value is district specfic. Some districts allow you to simply insert languagae into your chapter 13 plan to the effect that the lien will be stripped. After all, the BK petition lists the value of the property on Schedule A. Other districts require a Motion to Value, reason being, it gives the 2nd mortgage an enhanced notice of what is going to happen; reason being, the motion would be served on the 2nd mortgage lender.

As for the 2nd mortgage lender being able to dispute at any time, total rubbish. The value of the asset (the home) is established at the time the case is filed. Once the plan is confirmed with a lien strip provision, the 2nd lender is out of luck.