Orinda Bankruptcy Lawyers
Take back control of your financial life and get rid of your debts. There is no shame in filing bankruptcy and getting a fresh start. Have you not suffered enough already? We are committed to providing you with the best bankruptcy experience for a reasonable fee. Call us toll free and schedule a FREE PHONE CONSULTATION or FREE OFFICE CONSULTATION with our experienced Orinda bankruptcy lawyers | attorneys and find out if bankruptcy is for you.
Meet our attorneys: Ryan C. Wood and Kitty J. Lin
We are committed to providing you with the best bankruptcy experience for a reasonable fee.
Bankruptcy can get rid of your underwater second mortgage or equity line of credit. When you file a chapter 13 bankruptcy your house is valued and it is determined whether or not the second mortgage or equity line of credit has no value or equity. If there is no equity for the second mortgage holder or equity line of credit holder then their lien can be stripped and valued at zero. This means the previously secured debt is turned into a general unsecured debt just like a credit card and debt and treated accordingly. You will no longer make the second mortgage or equity line of credit payment. You will however have to make the monthly chapter 13 plan of reorganization payment to the chapter 13 trustee. Filing a chapter 13 requires that you pay back to your creditors what you can each month for three to five years. In most cases after secured debts are paid there is very little money left over for those holding unsecured debts like credit card companies. Whether the chapter 13 plan is three or five years depends upon the amount of your gross income. This gross income is determined by taking an average of your gross income for the six-month period prior to the filing of the bankruptcy case. Recently the United States Supreme Court ruled that the income at the time of confirmation should or could be considered too. This ruling was the result of peoples income decreasing and therefore the six-month average was far more than their actual income. Their obligation to their creditors would be far more than they could afford unless their actual income was considered.
By
Ryan
C. Wood