What happens to 2nd Mortgage?

[daytona]

now thats very interesting. They call that a Ch- 20

I didn't think chapter 20's were available anymore after the law change in 2005..??

I've posted this elsewhere but I'll throw another curve at you. I have a 125% "overequity" 2nd of ~150k. The appraisal they used made about 100k "unsecured" at funding...another words the 2nd knew they were lending approx 2/3 unsecured at closing. Needless to say home values have dropped and the value would not even cover the first.

I don't see why the ~100k of the 2nd shouldn't be stripped in a CH7 as it was knowling lent unsecured at funding...paid off credit cards, etc.

I know true "stripping" of a 2nd can only happen in a Ch13 and if even $1.00 of value remains then the whole mortgage survives. In my case 1.00 would not survive period...that is beside the point.....BUT why shouldn't the "unsecured" portion be stripped? I plan to bring this up to the attorneys I plan to meet this week to see what their take is...

As others have stated the other alternative is to not reaffirm the second and settle with them after a Ch7...I would rather settle 50k than 150k in my case and again the lendor lent "unsecured" for the 100k...it's right in their own closing documents with the appraisal they used.

[biotechsolution]

I had a chapter 7 that was discharged. I did include my 2nd mortgage in the chapter 7, BUT i continued to pay my first mortgage and stayed current on it.

Now, the second mortgage that was originally secured by the house is now
a unsecured debt- being discharged in the chapter 7. It survives the chapter 7 and the lein stays on the house.

Now, I stopped paying my first mortgage and I am going into a chapter 13. I will pay the 1st mortgage arrears payments back in a 3-5 year plan, once I payoff the chapter 13 plan the second mortgage lein will be stipped of the house.

You will have to wait for 4 years before you can file your chapter 13 to lien strip the 2nd. You can't receive a chapter 13 discharge within 4 years of receiving a chapter 7 discharge.

IF you file a chapter 13 within the time frame it has to be a 100% payback plan.

thats why it's used for priority tax debt or mortgage arrears when filing a chapter 13 after a 7.

If your attorney is telling you that you can lien strip right after a chapter 7 discharge you better get a new one.

[pcn]

You will have to wait for 4 years before you can file your chapter 13 to lien strip the 2nd. You can't receive a chapter 13 discharge within 4 years of receiving a chapter 7 discharge.

IF you file a chapter 13 within the time frame it has to be a 100% payback plan.

thats why it's used for priority tax debt or mortgage arrears when filing a chapter 13 after a 7.

If your attorney is telling you that you can lien strip right after a chapter 7 discharge you better get a new one.

I think your own quote "You can't receive a chapter 13 discharge within 4 years of receiving a chapter 7 discharge." actually explains what makes it work. You aren't discharged until 5 years after you file the ch13.