About This Site
Lien stripping is one of the most powerful tools available in bankruptcy for homeowners who owe more than their property is worth. Under 11 U.S.C. Section 506(a), a secured claim is only secured to the extent of the value of the collateral. Any amount above that value becomes an unsecured claim -- and in Chapter 13, a wholly unsecured junior lien can be "stripped off" entirely.
This site will provide a detailed guide to lien stripping and cramdown procedures, covering the valuation hearing process, the distinction between partially secured and wholly unsecured liens, circuit-specific rules, and the critical Supreme Court decisions (like Dewsnup v. Timm) that shape how Section 506 is applied.
If you have a second mortgage or home equity line of credit on an underwater property, lien stripping may allow you to eliminate that debt through your Chapter 13 plan. We will explain the requirements, the process, and the common pitfalls that derail lien strip motions.
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