Many homeowners unfortuneately owe more on their mortgage than their home is worth.  There has been quite a debate in Congress about whether or not to amend the Bankruptcy Code to allow homeowners to “cramdown” the amount of thier mortgage to the value of their home.  Unfortuneately, it appears the financial industry lobby will defeat this legislation.  The good news is that if you have a second mortgage and the value of your home is less than what you owe on your first mortgage, you may be able to cramdown the second mortgage in a Chapter 13 bankruptcy.  The effect is to make the second mortgage an “unsecured” debt which is dischargeable.  This could be just the strategy you need to stay in your home and avoid foreclosure.  Please contact us if you would like more information.

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