Chaper 7 and dismissing a HELOC

[momofthree]

Can you do that?



H

No. You have to complete your ch.13 term (3-5 years) and receive a discharge before the lien strip is completed. At that time, any other unsecured debt would also be discharged, so filing ch.7 wouldn't be necessary at that point.

There is what's called a ch.20, where a ch.7 is filed first to discharge the unsecured debt, and then the ch.13 is filed to strip the lien. I know next to nothing about how a ch.20 works....

[freality]

I had it backwards, sorry. I knew people were combining them, and that Ch13 was necessary to strip the 2nd mortgage...just didn't know the exact details.

[biotechsolution]

Hello Everyone,

I am about to file chapter 7. After I do the lawyer is filing a motion to have the HELOC categorized as unsecured debt. (My house appraisal is less than my first mortgage).
Has anyone been able to accomplish this?

Does anyone know the Arizona statue this would fall under?

Thanks ahead of time

Hobs

I hope your lawyer isn't charging you more to file that motion. THe motion makes no sense, you can't change the HELOC to unsecured if it was a secured at the time by original mortgage and house. Stripping debt from secured to unsecured only happens in a Chapter 13.

[Hobs]

I hope your lawyer isn't charging you more to file that motion. THe motion makes no sense, you can't change the HELOC to unsecured if it was a secured at the time by original mortgage and house. Stripping debt from secured to unsecured only happens in a Chapter 13.

When I talk to him on Friday he said the same thing. We are not filing a motion, but will try to negoate a settlement with the HELOC bank before the discharge.





H