Chapter 13 Bankruptcy may provide you with a way out of a Second Mortgage or Home Equity Loan
The applicable rule in the Orlando or Sanford areas is that if the home is worth less than the value of a first mortgage the second may be taken off during the course of a reorganization. To be clear, if even one penny is covered (we would say secured) then the mortgage can not be taken off of the home. However, if the value of the home is worth less than the value of the first mortgage, a Chapter 13 Bankruptcy or reorganization may be a viable method of decreasing the debt as against your home. This also prevents the mortgages from later on emerging and trying to go after the value of your home once the equity in your home increases. These actions, known as “zombie second foreclosures” may remain dormant for years before reemerging as against a homeowner. To see if you may be eligible for relief, please feel free to contact our offices. Some years ago we had created a video explaining some of these matters in more detail. It is provided here.
Student Loans
Naturally second mortgages aren’t the only area of debt that can be helped with a Chapter 13 bankruptcy. Special treatment is afforded to student loans. These student loans are subject to federal guidelines and, upon filing, parties going through a reorganization can be subject to a partial, or in some cases, complete forgiveness as to their student loans. To determine if you may qualify, please feel free to contact our offices.
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