I thought it would be a good idea to create a post about Lien Stripping. This option is the main reason why I personally decided to go with a Chapter 13. You cannot lien strip in a Chapter 7.
I thought since I am going to go into BK and KILL my FICO then I might as well get rid of my worst offending debt and that’s the HUGE Second Mortgage I carry around on my back.
Also, I dread moving AND because rents cost more than my first and my HOA combined I decided that in the long run, if I can manage a payment plan through the Chapter 13, then this is the way for me to go.
In FIVE years, (Sixty Payments) I will come out having learned to live WITHOUT ANY CREDIT CARDS and be debt free! Now at my age, you don’t need to tell me the trick is NOT to go into debt again… and you don’t have to tell me that having no equity sucks! I learned this the hard way.
So when I am almost 60 years old, I will finally have my housing costs at the 35% of my income where they are supposed to be!
I am not a lawyer and I am only sharing what I think I know! So don’t take my word for anything other than a debt ridden single mom trying to find my way back from the depths!
Here is the NOLO website that can really answer all your questions if you are considering this debt restructuring option.