Legal Question in Bankruptcy in California

Re: chapter 13

Not automatically. A second mortgage MAY be capable of being stripped as a secured debt, and turned into an unsecured debt if you can prove to the court that the value of the house is less than, or equal to the total balance due on your first. This, however, must be done through either a motion, or adversarial proceeding (depending upon the jurisdiction) in your chapter 13, and can be costly. It is, however, a great remedy where the second is totally unsecured because of a loss of value in your home.

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Re: chapter 13

A Chapter 13 will not automatically void a second mortgage. In order to void the second mortgage you must file a motion (called a Lam Motion in California) and provide an appraisal of the house. If the house is shown to be worth less than the amount owed on the FIRST mortgage, then the Court can void the second mortgage.