Enfield, Connecticut Bankruptcy Attorney Understands How Bankruptcy Impacts a Second Mortgage
Connecticut Bankruptcy Law Firm Experienced in Second Mortgage Elimination
Many struggling 完美彩票开户网址owners take out a second mortgage with the hopes of improving their financial situation, only to realize little or no benefit and instead grow their already unmanageable debt.
Known as 80-20 mortgages, second mortgages gained notoriety during the housing bubble of the mid-2000s when lenders attempted to profit from anticipated increases in 完美彩票开户网址 values. Because a second mortgage loan usually carries a higher interest rate than the larger obligation and was designed with a balloon payment after a defined grace period, these combined mortgages make loan payments even more expensive for financially strapped borrowers who could barely afford their first mortgage.
Chapter 13 Bankruptcy and Second Mortgages
Those who file for chapter 13 bankruptcy may be able to avoid paying down a second mortgage, since most bankruptcy courts consider a second mortgage to be secondary debts that cannot be collected until all the primary debts have been settled. Since most people file bankruptcy with few assets and little in the way of liquid funds, secondary creditors typically write off their debts at the beginning of the bankruptcy process.
Although you may lose your 完美彩票开户网址 to your primary mortgage lender, you likely won't be responsible for settling a second mortgage. And under certain circumstances, it may be possible to eliminate your second mortgage and keep your 完美彩票开户网址, if your 完美彩票开户网址's fair market value has dropped by more than the value of your second mortgage and the bankruptcy trustee considers the debt wholly unsecured.
Wondering whether you may be able to eliminate your second mortgage through bankruptcy? The attorneys at Susan M. Williams LLC can help you make an informed decision. Contact our firm online, via e-mail, or call 860-265-4764 today – your initial consultation will be free.