L is for Lien Stripping

Ch13 bk, Ch7 bk | 11. Jan, 2012 by | 11 Comments

Lien stripping, in a nutshell, is converting a secured debt to an unsecured debt. The most common place to find this is in stripping a second mortgage in a Chapter 13. In a down market, there are ample opportunities to strip mortgages, especially people who got 80/20 mortgages.

To strip a second mortgage, the second mortgage must be completely unsecured. For example, if you have a house worth 300k, a first mortgage of 310k and a second mortgage of 90k, the second mortgage would be completely unsecured and strippable. If the house was worth 320k, the second mortgage would be partly secured and unstrippable. In close situations, an appraisal will help to figure out if a junior mortgage can be stripped. Over the life of a 30-year second mortgage, the savings obtained by stripping a second mortgage can be huge.

For other L bankruptcy terms:
Lien – New York Bankruptcy Lawyer, Jay S. Fleischman
Lien Stripping – Omaha and Lincoln, Nebraska Bankruptcy Attorney, Ryan D. Caldwell
Luxuries – Colorado Springs Bankruptcy Lawyer Bob Doig
Lie, the Big Mortgage Industry – St. Clair Shores MI bankruptcy attorney
Lift the Stay – Marin County Bankruptcy Attorney, Catherine Eranthe
Long Term Payments, Chapter 13 Plans – Philadelphia Suburban Bankruptcy Lawyer, Chris Carr
Liquidated- Metro Richmond Consumer and Bankruptcy Attorney, Mitchell Goldstein
List It Or Lose It- Allen Park, Michigan Bankruptcy Lawyer, Christopher McAvoy
Life Insurance- Cleveland Bankruptcy Lawyer, Bill Balena
Listing Assets and Debts in Bankruptcy – Los Angeles Bankruptcy Attorney, Mark J. Markus
Lawyer – Wisconsin Bankruptcy Lawyer, Bret Nason
Limits of Bankruptcy-Livonia Michigan Bankruptcy Lawyer, Peter Behrmann
L is for Levy-Lakewood, Ca Bankruptcy Lawyer, Christine A. Wilton
Lien Avoidance in Bankruptcy-Pittsburgh Bankruptcy Attorney Shawn N. Wright

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