 | 
08-13-2002, 04:16 PM
| | |  Turning a 2nd mortgage into an unsecured loan
What is the name of your state? Kansas
In an earlier post, someone said I could strip down most or all of my 2nd mortgage into an unsecured loan. I don't understand how this could be done. I wanted to contact an attorney in my area, but don't want to look the fool asking for something that is impossible to do. I lost my job after Sept. 11 and the bills are eating us alive. We don't want to lose our home, but the 2nd mortgage holder IS NOT willing to help us and it looks like filing BK is the ONLY way out. If ANYONE knows how we can turn a secured loan into an unsecured loan, please let me know. I have to seek an attorney pretty soon now, and need to know what I'm asking for. Thank you!!!!! |
08-13-2002, 05:18 PM
| | Senior Member | | Join Date: May 2001
Posts: 6,450
| | | You have 2 mortgages. The combined total is greater than the amount of equity in your home. The first mortgage has priorty. The second mortgage or a portion of it is now unsecured. I promise you, a lawyer will know exactly what you are asking. It is refered to as stripping a mortgage or, in some cases executing a cramdown. |
08-13-2002, 05:31 PM
| | Senior Member | | Join Date: Feb 2002 Location: Nashville,TN
Posts: 15,706
| | | Are you considering Chapter 7 or 13 ?
Under Chapter 13:
"Under current law, debtors in Chapter 13 are allowed to “cramdown” or “stripdown” a secured debt (except for a mortgage on real estate), meaning that they can reduce the amount of a secured debt to the value of the collateral, leaving the difference unsecured. Often, this allows debtors to pay less to the secured creditor. "
This says 'except for mortgage on real estate' , so I'm not sure if it DOES apply in your case. |
08-13-2002, 07:28 PM
| | Senior Member | | Join Date: May 2000 Location: Catatonic State
Posts: 75,781
| | | [quote]Originally posted by bigun
[b]You have 2 mortgages. The combined total is greater than the amount of equity in your home. The first mortgage has priorty. The second mortgage or a portion of it is now unsecured.
**A: For clarification prposes; the 2nd mortgage does not become legally unsecured until the BK Trustee says it is or a Court adjudicates as such. In this post, the writer has not even filed BK, thus the second mortgage or a portion thereof is not unsecured. There is just no full equity covering the total mortgage and in theory the negative equity is unsecured.
*******
I promise you, a lawyer will know exactly what you are asking. It is refered to as stripping a mortgage or, in some cases executing a cramdown.
**A: and it does not work all the time but the times it does work I have only seen it work in a 7 and not a 13. Only a few lawyers know how to do this. Most of them do not.
Last edited by HomeGuru; 08-13-2002 at 08:11 PM.
|
08-14-2002, 12:40 AM
| | | | I thank you all for the responses. Now I can call around to attorneys who offer free consultations and know what I'm asking them to do. You were all a tremendous help and I can't thank you enough! God bless you all!! |
08-14-2002, 01:57 AM
| | Senior Member | | Join Date: May 2000 Location: Catatonic State
Posts: 75,781
| | | That's right. Good job bigun and Ladynred. Keep up the posting. | |
Currently Active Users Viewing This Thread: 1 (0 members and 1 guests) | | | | Thread Tools | | | | Display Modes | Rate This Thread |  Linear Mode | | 
Posting Rules
| You may not post new threads You may not post replies You may not post attachments You may not edit your posts
HTML code is Off | | | |
All times are GMT -5. The time now is 04:16 AM.
