You’ll need to prove to the court the value of your home. Each court will accept different types of evidence. However, you should talk with an attorney about getting the following:independent real estate appraisal authenticated by the appraiseronline listings of equivalent properties
ad valorem tax assessment appraisals;
, To strip a second mortgage, it must be wholly unsecured.This means there is no value left in your home because your senior mortgage is worth more than the value of your house. Essentially, you need to be upside-down on your first mortgage.For example, imagine your home is worth $250,000. Your senior mortgage is worth $275,000. You are upside-down, so all junior mortgages can be stripped off the property.
However, if your home is worth $250,000 and your senior mortgage is worth $240,000, then you are not upside-down. You can’t strip a second mortgage because there is $10,000 worth of value available.
 You might have more than one junior mortgage. In that situation, you can strip off any that are unsecured using a Chapter 13 bankruptcy.In fact, you may strip any junior lien on the property, such as a home equity line of credit or construction lien.


Return to the example above, but imagine you have three mortgages on the property. Your home is worth $250,000 and your senior mortgage is worth $240,000. You cannot strip your second mortgage because it is not wholly unsecured. However, if you had a third mortgage, you could strip it.
 Before applying for bankruptcy, you must attend mandatory credit counseling. Your counselor can assess your situation and help you understand if bankruptcy is right for you. A counselor can also help you create a repayment plan.You can find a list of approved credit counselors on the U.S. Trustee’s website: https://www.justice.gov/ust/list-credit-counseling-agencies-approved-pursuant-11-usc-111. Click on your state under “Choose Option.”
If you live in Alabama or North Carolina, then visit http://www.uscourts.gov/services-forms/bankruptcy/credit-counseling-and-debtor-education-courses to find credit counselors.
You can receive counseling in person, online, or over the phone. Ideally, you should try to attend in person.
 Because Chapter 13 is a complicated bankruptcy, you should work with an attorney. The process of removing a junior mortgage is especially complicated, so the help of an experienced bankruptcy attorney is critical.



Find a bankruptcy attorney by contacting your local bar association and asking for a referral.Gather your financial documents and schedule a consultation.
You should also hire the lawyer to file the bankruptcy for you. Ask the attorney how much he or she charges. Often, bankruptcy attorneys will charge a flat fee.
In a Chapter 13, you can fold some or all of your attorney’s fees into your payment plan, which means you can pay them off over three to five years.This will make getting a lawyer affordable.
 You must file a petition and other forms which list your income, assets, and debts.These forms are called schedules. Your lawyer can complete this paperwork for you. Make sure to provide them with all updated financial information.


Typically, you will file bankruptcy in the federal district where you live. You can find the court by using the court locator here: http://www.uscourts.gov/court-locator. Choose “Bankruptcy” under Court Type and then enter your address.
You will have to pay a fee to file. Your lawyer will bill you.
 The heart of a Chapter 13 bankruptcy is the repayment plan. Depending on how much you make, the plan might last three to five years.Your judge must approve the plan, and you can submit it when you file for bankruptcy or within 15 days.Your repayment plan will treat debts differently. For example, you must pay some debts in full. These are called “priority” debts and include back child support, unpaid alimony, and some taxes.
Depending on your income, you will probably pay only a small portion of any unsecured debt, such as credit cards. Your junior liens will be treated as unsecured debt under the repayment plan., The bankruptcy trustee will call a Meeting of Creditors 21-50 days after you file for bankruptcy. You must attend, and your creditors have the option of attending.However, many creditors probably will not even show up.


The purpose of the meeting is to ask you questions about your repayment plan as well as your income. The meeting is an opportunity to confirm the information included in your paperwork.
If your creditors want to object to your repayment plan, they don’t do that at the meeting. Instead, they file paperwork with the court.
 Your lawyer will need to file a motion with the court to determine whether you can strip junior mortgages/liens from the property.Your lawyer must file this motion before the judge confirms your repayment plan.Some courts have developed a form your lawyer can use when filing this motion.
You must provide the lienholder with proper notice of your motion so they have a chance to respond. You must also provide the court with proof that you provided notice. Often, this proof consists of a signed statement that you gave the lienholder a copy of your motion and the date it was sent.
You must attend a hearing, where the judge will make a conditional order that the second mortgage is unsecured. You cannot remove the mortgage, however, until you complete your repayment plan.
 The judge must hold a hearing within 45 days of the Meeting of Creditors. At the hearing, the judge will analyze whether your repayment plan is realistic and whether it satisfies legal requirements.If your creditors want to object to the plan, they can do so at this time.


The judge might refuse to confirm the plan. In that situation, you and your lawyer will have to submit a modified plan, which the judge will consider.
 If you stop paying, the judge can dismiss your bankruptcy and your second mortgage won’t be stripped.Accordingly, you should commit to making timely payments.


To help you, choose payroll deduction.Your required payments will be deducted from your paycheck.
Unfortunately, life can intervene. You might become sick or lose your job. If you can’t make your payments, you’ll need to get the judge to approve a revised repayment plan. Contact your lawyer as soon as possible if you run into trouble paying your debts.
 Before you can exit bankruptcy, you must take a debtor education course. This course will help you develop a budget and gain the tools necessary to avoid bankruptcy in the future.You can find an approved course here: https://www.justice.gov/ust/list-approved-providers-personal-financial-management-instructional-courses-debtor-education.
 Having completed your repayment plan, you need the judge to convert a conditional order that the second mortgage is unsecured into an unconditional order. The process will vary depending on the judge.Typically, your lawyer will file more paperwork with the court, either a motion or a complaint for an adversary proceeding.
In your court document, you ask the judge for an order that the second mortgage is invalid, void, and unenforceable.
Once the judge signs off, you might have to take the judge’s order to the Recorder of Deeds office and have the mortgage removed from your property deed.
Appraise the value of your house.
Compare the home’s value to your senior mortgage.
Strip more than one mortgage.
Attend credit counseling.
Consult with an attorney.
File your paperwork with the court.
Create a repayment plan.
Attend a Meeting of Creditors.
File a motion to determine secured status of the lien.
Attend the confirmation hearing.
Make all payments under the plan.
Take a debtor education course.
File for an adversary proceeding.
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