Should We File a Chapter 7 and Chapter 13 Bankruptcy to Save Our Home? – Tom

“Dear Lewis,

I live in Nevada, the highest unemployement in the nation. Both wife and myself have been laid off. I was laid off Feb this year and my wife Feb last year. We have a stack of collection accounts and we have not paid our mortgage in a year. We want to keep our house because we have sank our life savings into it. What bankruptcy would we file. I heard 7 to get rid of debt including second mortgage and then a 13 to modify the house.

What bankruptcy would we file. I heard 7 to get rid of debt including second mortgage and then a 13 to modify the house loan. Is this correct and/or do you have better advice.

Thank you,


Dear Tom,

You need to see a local bankruptcy attorney.

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If you want to save your home, chapter 7 is not an option. You can only end your personal obligation to pay the loans in chapter 7. The second mortgage lien would remain, and if you don’t pay, they could foreclose.

In chapter 13, you can do what is called a “lien strip”. That means if your home is worth less than what you owe on your first mortgage, the second mortgage has no security and can be stripped off. But again, this can only be done in chapter 13.

Please sit down with a bankruptcy attorney in your area. Almost all of us offer free consultations. A chapter 13 should not be filed without an attorney, and stripping a second mortgage is a very precise legal issue.

Good luck!

My name is Lewis Roberts and I’m an attorney licensed in Florida and Georgia. My practice focus is consumer bankruptcy, real estate issues/closings, and mortgages. I also have Florida real estate broker and mortgage broker licenses. I am a proud member of the National Association of Consumer Bankruptcy Attorneys (NACBA), National Association of Consumer Attorneys (NACA), and a graduate of Max Gardner’s Bankruptcy Boot Camp. I enjoy helping people with decisions that impact their financial well-being.

Legal Disclaimer: This is for educational purposes only. It is not to be relied upon as legal advice. It also does not create an attorney-client relationship. No such relationship is formed with attorney without a written agreement.

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