How can I get rid of my second mortgage?

Stripping a Second Mortgage What follows is a simplistic analysis of stripping of second mortgages in Chapter 13 bankruptcies. Your individual circumstances will definitely play a role in what you ultimately decide to do. If you are like many homeowners who owe more on their mortgage than the home is worth, you may be able to eliminate, or "strip," a second mortgage through the process of Chapter 13 bankruptcy. The United States Supreme Court has ruled that you cannot “strip” a second mortgage in a Chapter 7 bankruptcy. However there are some cases, where you can get rid your second mortgage so long as and because it is wholly unsecured. This means that the value of your house must be equal to or less than the amount owed on your first mortgage. For example, if you owe $175,000 on your first mortgage and $75,000 on your second mortgage, but your home is valued at $160,000, there is not enough value in your house to secure the second mortgage. A value decline such as this is not uncommon in today’s real estate market. The real estate bubble caused many homes purchased during the height of that market to have values that have come crashing down in the past 3 years. Although most home mortgage lenders do not oppose the process when presented with the facts regarding the mortgage balances and home values, this process can be complex. A second or subsequent lien on your property can only be stripped once you have completed the chapter 13 repayment plan. This means making all of the payments for the entire repayment period, receiving a discharge in your case and staying current on your first mortgage during your Chapter 13 bankruptcy.