Chapter 7 (LIQUIDATION)
- You can include all of your unsecured debts.
- Many people who are considering filing a Chapter 7 Bankruptcy are usually in distress with debt due to financial instability and or illness. By filing a Chapter 7 Bankruptcy it will ELIMINATE your unsecured debt, and help you obtain a FRESH START.
Chapter 13 (REORGANIZATION)
- Unlike a Chapter 7 Bankruptcy, a Chapter 13 Bankruptcy includes all of your assets and debts into a 36 or a 60 month repayment plan. A Chapter 13 Bankruptcy reorganizes your finances over time.
- In a Chapter 13 Bankruptcy you can LIEN STRIP a 2nd Mortgage or a Line of Credit.
- If you are in FORECLOSURE, due to loss of income, hardship, but now you can afford to make the mortgage payments, and back payments owed to the servicer. You might be eligible for a Chapter 13 Bankruptcy.
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if you have a second or a third mortgage that is secured on your home and want to eliminate it, it can be accomplished in a Chapter 13 Bankruptcy. This process is called “LIEN STRIPPING.”
Under a Chapter 13 Bankruptcy a second or third mortgage that is ENTIRELY UNENCUMBERED by the value of your home is allowed to be treated as an “UNSECURED DEBT” in a LIEN STRIP. In Re Lam 211 B.R. 36 (9th Cir. BAP 1997). Like a credit card you will be able to pay pennies on the dollar for this enormous debt. However, this is not a simple process and requires ATTORNEY ANALYSIS from a qualified attorney. A lot of debtors turn to non-attorneys or inexperienced attorneys who don’t understand the complete process of Lien Stripping and wind up in the same situation but with less money. CALL NOW and arrange a FREE CONSULTATION with our principal attorney, Mark S. Martinez, Esq. who can successfully navigate you through this complex process.
Is your second or third lien FORECLOSING? If so, a LIEN STRIP in a Chapter 13 Bankruptcy is recommended. Remember that if you are behind on your second or third lien they can file a FORECLOSURE on your home if you don’t take action.
WARNING!!! If you don’t pay your homeowners association dues, the HOA can foreclose on your home!HOA’s are aggressive and sometimes they don’t like to negotiate a payment plan to cure your delinquency.
If you have received Notice of Default or a Notice of Sale from your HOA, understand that you are liable for the unpaid assessments, all late charges, attorneys’ fees, and interest.
You can discharge HOA dues in a Chapter 7 Bankruptcy only if you are surrendering your home.
If you intend to keep your home, and the HOA is not willing to negotiate a payment plan with you. You could petition your HOA dues directly into the Chapter 13 Bankruptcy plan. Attorneys’ fees will also be included into the plan but they can be negotiated.
If you are in FORECLOSURE, filing a bankruptcy becomes a tool that may help you save your home. Whether you file a Chapter 7, 11, or 13 Bankruptcy, under Federal Bankruptcy Law a mechanism aptly named the automatic stay will BAR the bank from foreclosing on your home. 11 U.S.C. § 362. This action immediately STOPS creditors, lenders/servicers from attempting to collect the debts that you owe and preclude these same creditors from seizing or using assets to claim money that is owed to them. Once a bankruptcy is filed, a foreclosure sale will be automatically postponed or cancelled until the automatic stay is lifted.
As of December 5th 2016, United States Bankruptcy Court approved “LMM” LOAN MODIFICATION MANAGEMENT PILOT PROGRAM to assist homeowners in FORECLOSURE. The “LMM” program is a pilot program and not a district wide program. In the central district of California certain judges are participating in this program: Los Angeles, Riverside, Santa Ana, and San Fernando Valley. This new program will help homeowner’s work out a solution to their foreclosure while they are active in Chapter 7 and Chapter 13 Bankruptcy. Call LOMM now to learn more about this program!
A JUDGEMENT LIEN is a lawsuit won against you and then attached against your property. For example; Real Estate Liens, Personal Property Liens, and Vehicle Liens are “CREDITORS.” As you know, creditors have many options to collect on a debt. If the debt is in DEFAULT, then a CREDITOR can obtain a judgment against you and record it against your property. A judgment that is attached to your property may prevent you from selling or refinancing on your home.
A JUDGEMENT LIEN attached to your property, can be removed or avoided in a Chapter 7 Bankruptcy or a Chapter 13 Bankruptcy. This process is called LIEN AVOIDANCE. However, not every “lien” can be avoided.
A nonconsensual lien or a lien that you don’t agree to, it can be “avoided” in a bankruptcy. These types of liens are; judgments, executions, mechanic, statutory, and tax liens that are attached to your property. Sometimes creditors attach a lien on your property without your consent. CALL NOW FOR A FREE CONSULTATION!