Posts Tagged ‘filing bankruptcy’

Filing for bankruptcy. My second mortgage, now my first?

February 12th, 2012 by Jarad

Question:  I am in the process of filing for bankruptcy. I am filing chapter 13 so I can have my second mortgage, which is a line of credit through Bank of America, dismissed. My attorney just called and said that because my first mortgage was obtained after my HELOC, only because we refinanced, that the court may deem the HELOC as my first mortgage. Is this possible?


February 11th, 2010 by Jarad


Answer: -Well for most people who go through a hardship like foreclosure, the main reason they file bankruptcy is because a judgment was filed against them. And since they are not in a position to pay off their mortgage amounts, bankruptcy was their only option unless they wanted their wages garnished. Bankruptcy can protect you from a deficiency judgment if you file before the judgment as well because that mortgage amount would be included in the bankruptcy. Most people wait to file bankruptcy until after foreclosure because lenders have don’t necessarily have to file a judgment against the homeowner. They can issue a 1099 which means the mortgage amount they forgave is considered as taxable income. I would recommend you seek counsel from a professional bankruptcy attoney so you know all your options. Good Luck

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