2nd mortgage ch 7

[mybk]

Does my second mortgage have to be current to file Chapter 7 if I want to keep the home?

[Sham11801]

In short, yes. The trustee made sure to ask me if all my mortgage payments current, and then said "including the 2nd one?"

[mybk]

After poking around some more, I have found there is a clause to that. If there is no chance of the second foreclosing (meaning you are under the first mortgage in value).

What it implies is that the second would not lift the automatic stay because to do so implicates them into taking the property to satisfy the debt (foreclosure), and it is not in their financial best interest to do so.

So far, anything I have read indicates it is not an automatic thing, it is a precaution to keep the mortgages current to avoid from the lender lifting the automatic stay. In this case, it is unlikely.

We will be confirming this with our attorney. My intention is that if this is the case, to settle with them after the Chapter 7 rather than have them end up with 0 after a lien strip. Not that I am all so concerned about them, but I believe it is a more fair solution for them being a secure creditor.