The answer to that question – in the Middle District of Florida – is NO.
If the amount of the first mortgage on a property exceeds the value of the property (the home is “underwater”) then a second mortgage or any other junior lien can be “stripped off” in a Chapter 13 Bankruptcy.
But, on July 28, 2010, the Bankruptcy court in the Middle District of Florida declined to follow a minority of courts which allow stripping in Chapter 7. The Florida court ruled that a second mortgage on a primary residence can NOT be “stripped off” in a Chapter 7 Bankruptcy, even though there is a a significant number of homes which lack equity beyond the first mortgage lien and there is a “high rate of home foreclosures in this area”.
If you want to keep your home, but can’t afford the payments, Chapter 13 Bankruptcy relief may be your best option. Call our offices for a consultation.