Legal Question in Bankruptcy in Indiana

Re: second mortage

If you were to file a Chapter 13, you could potentially discharge the 2nd mortgage and mechanics lien to the extent the value of your home is less than the secured amounts. Thus if your home is worth $120,000 you could avoid the mechanics lien and $15,000 of the 2nd mortgage. Get a good appraisal and an experienced bankruptcy attorney, avoiding liens is not for amatures. Hope this helps.

Re: second mortage

If you can qualify for a Chapter 13 case (meaning if you have a reqular source of income by which to fund a Chapter 13 plan) and if the true value of your home is only $100,000, then you may be able to avoid the mechanics lien and the second mortgage while retaining the home. (You can avoid those liens to the extent the lien values exceed the home value.) You need a good appraisal from a firm creditable to the bankruptcy trustee's office and a lawyer with experience in bankruptcy law. Good luck.