Chapter 13 and home apprazials

[BBNLB]

We are filing chapter 13 here in Oregon and hoping to keep the house, We had a real estate apprazial on the property it came in below our first so our attorney is going to try to strip the second, But my question is what happens if the lender on the second has an apprazial done and it comes in over the first amount. I understand if the value of the home is below the first the second can be stripped if the value is above the first the second cant be stripped so of course the lender is going to get and apprazial above the first, What happens at this point. Negotiate???

[despritfreya]

Three possible outcomes.

1. You file the adversary, lender files an answer, you go to trial & judge makes a decision - hopefully no equity

2. You negotiate a settlement.

3. You simply can't win - judge finds equity and/or lender not willing to settle - you walk away.

[Pandora]

was your appraisal an actual walk-through of your house and property or was it a CMA or BPO type (pulled surrounding comps, drove by and looked at outside of the house, took picture?) There's a huge difference when you are trying to strip a 2nd off.

Most 2nd mortgage holders end up doing a BPO or CMA - in which if you have a true appraisal done (walk-through), that usually trumps the BPO / CMA. Make sure if you got an appraisal that you get a copy of the realtors license along with your certified appraisal so that you can show he/she is licensed to perform.

Also be prepared that your 2nd is going to come in higher than your first - its usually the case - at which that time its as Des stated above. Of course, if you do end up in a lock down regarding value of 1st to 2nd and end up having to go to the judge - the 2nd can decide to concede at any time prior to your court date.

[justbroke]

Despri has the options laid out. If it goes to a hearing (or trial), the best evidence will win. If your appraisal is an actual full residential appraisal performed by a licensed appraiser and done on the appropriate forms (URAR), then it should have more weight. Generally speaking though, most of the junior lienholders don't complain or object, unless the appraisal came within 10% of the first mortgage. It can be expensive for the junior lienholder to fight the lien strip, although it appears that the objections are rising.

In the end, as Despri writes, just be prepared to walk. Make them eat wood! (My expression for forcing the lenders to take the home back and suffer the consequence.)

[smkrishna]

justbroke, I have been paying 1st mortgage (Chase) without fail for last 6 years. I stopped paying 2nd mortgage (BofA) for last 5 months as I am ready to file for Ch.13 and go for second lien stripping. The issue is my primary loan is $218K and second loan is $126k. But, my home value is around $220 - $230k. So, the chances of BofA winning the battle is high. In that case, can I stop paying mortgage with Chase and stay in the same place for 12 to 18 months (as other people do)??? Will BofA allow me to do that after they win adversary?

Can second lien holder foreclose the house while 1st mortgage is being paid without fail?