Bankruptcy chapter 7 Equity line of credit thats charged off and a reaffirmed mortgage?

[edmondo93]

OK My mother in law wants to file Chapter 7. She has an Equity Line of Credit that has charged off as a bad debt and a regular mortgage. They want to foreclose on the Equity Line and take the regular mortgage with it. Can she bankrupt the Equity Line and reaffirn the regular mortgage without them taking the house?

[ailwyn]

OK My mother in law wants to file Chapter 7. She has an Equity Line of Credit that has charged off as a bad debt and a regular mortgage. They want to foreclose on the Equity Line and take the regular mortgage with it. Can she bankrupt the Equity Line and reaffirn the regular mortgage without them taking the house?

It depends. If she has less equity in the house than the amount of the 1st mortgage it may be possible to get the 2nd mortgage (HELOC) treated as an unsecured debt.

If this is her situation she needs to hire a very experienced bankruptcy attorney.

Screwing this up could affect her negatively for many years (or decades) to come.

[bean]

She needs to ask her BK Attorney this question and she does not have one she is foolish because she will only screw herself over. None of us have the complete file on her.