For people that dealing with issues with a 2nd Deed of Trust, Chapter 13 Bankruptcy has some relief that could be extremely useful. As discussed above while discussing mortgages, an individual can file for Chapter 13 relief to cure the delinquent amounts owed on a 2nd Deed of Trust. To avoid a foreclosure, our office can assist in filing Chapter 13 and cure the delinquent payments over the timeline of a Chapter 13 case.
Also, Chapter 13 rules allow individuals relief on a 2nd Deed of Trust if the home is underwater based on the 1st Deed of Trust. If the individual can prove the current fair market value of their home is less than what is owed on the 1st Deed of Trust, then the Court would issue an Order stating such value. That Order would then be recorded at the County and upon the successful completion of their Chapter 13 case, the 2nd Deed of Trust is required to remove their lien. This has commonly been referred to as a “lien-strip”. Our team has been successful in doing such for countless clients.