Mortgages
Lien Stripping Second Mortgage in Bankruptcy

Is it possible to eliminate a second mortgage through an Arizona bankruptcy? That’s a question that bankruptcy attorneys in the state get often. The short answer is yes. The longer answer depends on several factors. Can a Second Mortgage Be Eliminated through a Chapter 7 Bankruptcy? A Chapter 7 bankruptcy is a liquidation type of bankruptcy. Typically, second mortgage junior liens and HELOCs cannot be eliminated through this chapter. One exception exists, however, and this exception is called lien stripping. Lien stripping allows debtors to eliminate wholly unsecured debt like a second mortgage or a home equity loan. Typically, this…
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