Woodland Hills, California Bankruptcy Attorney
Housing values plummet during bad economic times, leaving homeowners with mortgages that require them to pay more than their houses are worth. When a homeowner files Chapter 13 or Chapter 11 bankruptcy, he or she may be able to discharge a second or third mortgage or a home equity loan on the property through a judicial process called lien stripping.
At Leventhal Law Group, P.C., I help clients remove second or third mortgages from their primary residences during bankruptcy proceedings. Not all individuals qualify, but if they do, they can greatly reduce their debt, have more money available to pay the first mortgage and improve their chances of keeping their homes.
Call a Los Angeles-area lawyer at the Leventhal Law Group, P.C. at 818-347-5800.
Car Loans and Cram Downs
If your car is now worth less than the amount outstanding on your car and you purchased it at least 910 days ago, a bankruptcy judge may reduce the outstanding debt by the difference between the loan and the value of the asset (car). You are still liable for the payments equal to the value of the car. Another benefit of employing a cram down on a car loan is that the interest rate is usually reduced.
It may also be possible to cram down tax liens. For example, if you owe property taxes that are greater than the value of the property, bankruptcy may allow you to reduce the amount you owe to the value of the property.
Chapter 7 and Lien Stripping
Liens can be reduced in Chapter 7 bankruptcy only if they prevent you from using the homestead or other exemption. For example, if you have a judicial lien on your property because of a lawsuit, it may be possible to strip away the lien so that you can use the full value of the homestead exemption in Chapter 7. However, this requires a special request to the bankruptcy court. I can advise you about the limited availability of lien stripping in Chapter 7.
The lien stripping and cram down processes can be complicated, and determining eligibility for them requires an in-depth understanding of bankruptcy law. As an attorney focused exclusively on bankruptcy law, I am able to explain how a cram down works and evaluate the benefits in their circumstances.
Lien stripping is not automatic in Chapter 7, Chapter 13 and Chapter 11 bankruptcy filings. It requires a motion to cram down as part of your bankruptcy filing.
Contact a Woodland Hills Lien Stripping Attorney
Call 818-347-5800 to schedule a free initial consultation about cram downs and lien stripping. My Woodland Hills, Los Angeles area, law firm offers the guarantee that you will always speak with an attorney, not a paralegal.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.