April 29, 2011 (Press-News.org) Stripping a Second Mortgage in a Chapter 13 Bankruptcy
One of current problems in the real estate market is the number of "underwater" mortgages, where the value of the properly has declined below the outstanding value of the mortgage. Banks have been extraordinarily resistant to the concept of loan modifications, where that modification would lower the principal value of the loan and bring it in line with the market value.
Most people are trapped in these houses, as they cannot sell them for a high enough price to allow them to pay off the mortgage. The U.S. Bankruptcy Code generally does not permit the loan value to be lowered or "crammed down" during a bankruptcy to the current market value of the property.
Second Mortgage
If you have a second mortgage or home equity loan, on the other hand, you may be able to discharge this debt through a Chapter 13 bankruptcy if the value of the property has fallen below the outstanding balance on the primary (or first) mortgage.
In this case, the second mortgage holder is no longer a secured creditor, as the property is no longer valuable enough to serve as the security interest the loan was originally based on. In essence, the second mortgage is unsecured, and it is akin to credit card debt. In a Chapter 13 proceeding, the mortgage holder's lien can be stripped from the estate and they will receive a pro rata share of the amount paid to unsecured creditors. Hence, the term "lien stripping." For example, if there is a $50,000 second mortgage on the property, the entire lien can be removed for 10 cents on the dollar ($5,000). The homeowner will save $45,000 and can have the remaining amount discharged. They will not have to pay it back.
Valuation
An important factor in this process is having a proper valuation of the property listed in the Chapter 13 plan. A creditor who fails to object to the valuation is bound to it once the plan is confirmed by the court.
Valuation can be a complex issue, often requiring the use of experts. However, with the widespread decline in real estate values, in many circumstances, it should be possible to verify the new value with an appraisal.
Underwater?
If your mortgage is deeply underwater and you have a second mortgage or home equity loan, you should contact an experienced bankruptcy attorney. He or she can review your outstanding loans and advise a strategy to obtain effective debt relief.
Article provided by Trepeck Bane PC
Visit us at www.chicagodebtsolutions.com
Stripping a Second Mortgage in a Chapter 13 Bankruptcy
If you have a second mortgage or home equity loan, you may be able to discharge this debt through a Chapter 13 bankruptcy. Learn how the process of "lien stripping" could help you stay in your home.
2011-04-29
ELSE PRESS RELEASES FROM THIS DATE:
A tale of 2 lakes: One gives early warning signal for ecosystem collapse
2011-04-29
Researchers eavesdropping on complex signals from a remote Wisconsin lake have detected what they say is an unmistakable warning--a death knell--of the impending collapse of the lake's aquatic ecosystem.
The finding, reported today in the journal Science by a team of researchers led by Stephen Carpenter, an ecologist at the University of Wisconsin-Madison (UW-Madison), is the first experimental evidence that radical change in an ecosystem can be detected in advance, possibly in time to prevent ecological catastrophe.
"For a long time, ecologists thought these changes ...
Missouri elk are being reintroduced in the wrong part of the state, MU anthropologist says
2011-04-29
According to prehistoric records, elk roamed the northwestern part of Missouri until 1865. Now, the Missouri Department of Conservation is planning to reintroduce elk, but this time in the southeast part of the state. While a University of Missouri anthropologist believes the reintroduction is good for elk, tourism and the economy, he said the effort may have unintended negative consequences that are difficult to predict.
R. Lee Lyman, the chair of Anthropology in the College of Arts and Science, has studied the history of mammals, conservation biology and wildlife management ...
Teenage Texting: A Roadway Danger
2011-04-29
Teenage Texting: A Roadway Danger
Distracted driving takes a heavy toll on our nation's highways: according to National Highway Traffic Safety Administration data, over 5,000 motorists are killed every year in crashes that involve driver distraction. Texting while driving is an especially dangerous form of distraction, as it involves taking your hands off the wheel, your eyes off the road and your mind off of driving. Teens are not only more likely to text, they are also more inexperienced behind the wheel: drivers under the age of 21 are involved in three times as many ...
TRMM Satellite sees massive thunderstorms in severe weather system
2011-04-29
The Tropical Rainfall Measuring Mission or TRMM satellite again flew over severe thunderstorms that were spawning tornadoes over the eastern United States on April 28 and detected massive thunderstorms and very heavy rainfall.
TRMM, a satellite managed by both NASA and the Japanese Space Agency, captured the rainfall rates occurring in the line of thunderstorms associated with a powerful cold front moving through the eastern U.S. on April 28. TRMM flew over the strong cold front and captured data at 0652 UTC (2:52 AM EDT) on April 28, 2011. Most of the rainfall was occurring ...
Rent Regulation Bill Advances Through New York State Assembly
2011-04-29
Rent Regulation Bill Advances Through New York State Assembly
Rent regulation law or rent law, a staple in the real estate landscape of New York City, has been eroding in recent years. Established after World War II, rent laws cap the amount of rent a landlord can collect for a particular rental unit. More than 300,000 affordable apartments have been reclassified as landlords exploit loopholes to charge more for rent under the old regulations.
Legislative Activity
Amidst concerns that the city is becoming increasingly unaffordable, lawmakers in the state Assembly ...
Alcohol, mood and me (not you)
2011-04-29
Thanks in part to studies that follow subjects for a long time, psychologists are learning more about differences between people. In a new article published in Current Directions in Psychological Science, a journal of the Association for Psychological Science, the author describes how psychologists can use their data to learn about the different ways that people's minds work.
Most psychology research is done by asking a big group of people the same questions at the same time. "So we might get a bunch of Psych 101 undergrads, administer a survey, ask about how much they ...
California Is One of the Deadliest States for Pedestrians
2011-04-29
California Is One of the Deadliest States for Pedestrians
Motor vehicle collisions involving pedestrians can happen in an instant: when a pedestrian steps off the curb, drivers inattentive to the crossing have only moments to react. Although pedestrian fatalities have actually been on the decline over the last decade, the number is still disturbingly high.
According to National Highway Traffic Safety Administration figures, 4,092 people died in 2009 in pedestrian accidents. Nonfatal pedestrian injuries are even more common: approximately 59,000 were recorded in 2009 ...
NASA's Swift and Hubble probe asteroid collision debris
2011-04-29
Late last year, astronomers noticed an asteroid named Scheila had unexpectedly brightened, and it was sporting short-lived plumes. Data from NASA's Swift satellite and Hubble Space Telescope showed these changes likely occurred after Scheila was struck by a much smaller asteroid.
"Collisions between asteroids create rock fragments, from fine dust to huge boulders, that impact planets and their moons," said Dennis Bodewits, an astronomer at the University of Maryland in College Park and lead author of the Swift study. "Yet this is the first time we've been able to catch ...
Wearing the Right Gear Can Save a Motorcyclist's Hide
2011-04-29
Wearing the Right Gear Can Save a Motorcyclist's Hide
For a motorcyclist, protective clothing is not a luxury, but a necessity.
Studies have found that motorcyclists who wear proper attire sustain fewer injuries in motorcycle crashes than those who do not. And while it is true that protective clothing will do little to shield riders involved in high-speed crashes, most motorcycle accidents occur at low speeds. In these types of accidents, motorcyclists are most likely to suffer injuries to the arms, legs and head. Wearing a helmet and the right type of clothing can ...
UCSB urban ecosystem research featured in leading ecology journal
2011-04-29
A team of scientists has produced an innovative new study of the environmental impact of major urban ecosystems, published in the April issue of the journal Ecological Applications.
The team includes Joseph P. McFadden and Jennifer Y. King, both of UC Santa Barbara's Department of Geography. They analyzed environmental data gleaned from the "Twin Cities Household Ecosystem Project," a study of 3,100 households in the cities of Minneapolis and St. Paul, Minn., and surrounding areas. The article is the first major paper to come out of the project.
The data analysis yielded ...
LAST 30 PRESS RELEASES:
University of Cincinnati experts present research at annual hematology event
ASH 2025: Antibody therapy eradicates traces of multiple myeloma in preliminary trial
ASH 2025: AI uncovers how DNA architecture failures trigger blood cancer
ASH 2025: New study shows that patients can safely receive stem cell transplants from mismatched, unrelated donors
Protective regimen allows successful stem cell transplant even without close genetic match between donor and recipient
Continuous and fixed-duration treatments result in similar outcomes for CLL
Measurable residual disease shows strong potential as an early indicator of survival in patients with acute myeloid leukemia
Chemotherapy and radiation are comparable as pre-transplant conditioning for patients with b-acute lymphoblastic leukemia who have no measurable residual disease
Roughly one-third of families with children being treated for leukemia struggle to pay living expenses
Quality improvement project results in increased screening and treatment for iron deficiency in pregnancy
IV iron improves survival, increases hemoglobin in hospitalized patients with iron-deficiency anemia and an acute infection
Black patients with acute myeloid leukemia are younger at diagnosis and experience poorer survival outcomes than White patients
Emergency departments fall short on delivering timely treatment for sickle cell pain
Study shows no clear evidence of harm from hydroxyurea use during pregnancy
Long-term outlook is positive for most after hematopoietic cell transplant for sickle cell disease
Study offers real-world data on commercial implementation of gene therapies for sickle cell disease and beta thalassemia
Early results suggest exa-cel gene therapy works well in children
NTIDE: Disability employment holds steady after data hiatus
Social lives of viruses affect antiviral resistance
Dose of psilocybin, dash of rabies point to treatment for depression
Helping health care providers navigate social, political, and legal barriers to patient care
Barrow Neurological Institute, University of Calgary study urges “major change” to migraine treatment in Emergency Departments
Using smartphones to improve disaster search and rescue
Robust new photocatalyst paves the way for cleaner hydrogen peroxide production and greener chemical manufacturing
Ultrafast material captures toxic PFAS at record speed and capacity
Plant phenolic acids supercharge old antibiotics against multidrug resistant E. coli
UNC-Chapel Hill study shows AI can dramatically speed up digitizing natural history collections
OYE Therapeutics closes $5M convertible note round, advancing toward clinical development
Membrane ‘neighborhood’ helps transporter protein regulate cell signaling
Naval aviator turned NPS doctoral student earns national recognition for applied quantum research
[Press-News.org] Stripping a Second Mortgage in a Chapter 13 BankruptcyIf you have a second mortgage or home equity loan, you may be able to discharge this debt through a Chapter 13 bankruptcy. Learn how the process of "lien stripping" could help you stay in your home.