Mortgage and Lien Stripping
Mortgage and Lien Stripping is a tool that essentially allows the bankruptcy to remove entirely unsecured liens from you property. However, that junior lien must not have even one cent of equity to secure the lien. For example, if you have a house worth $200,000.00 and your first mortgage is owed $210,000.00; then you would be able to strip off any other mortgages on your house. This can be done either with either Chapter 7 or Chapter 13 cases in Alabama, Florida, or Georgia. Until recently, this was a mechanism that was solely limited to Chapter 13 cases, but the recent decision of In Re McNeal, Case No. 11-11352 (11th D.C.A. 2012) changed that.