Expert: Mark J. Markus- California Bankruptcy Attorney - 4/30/2009

Question
I filed a Chapter 7 for my unsecured debts after my divorce, and am waiting for discharge papers any day now. I have a car loan and a 1st and 2nd mortgage. I have not reaffirmed any of these. I am letting them repo the car after my discharge. My first mortgage is approx 10k below my homes value (now), and the second is almost 100k over the value. Is there any way to modify first mortgage w/lender to make payments lower, and not pay the second any longer without them foreclosing on me due to Chapter 7? I know they are stripping leins on Chapter 13s, but this was after I had filed a 7. I could afford to stay in my house if I didn't have the 2nd. Also - I was thinking of having a forensic loan audit done on both loans, is it worth it in case there's a problem with either of the mortgages? Thanks for any help or advice you can give.

Answer
Yes, you can seek to modify your loan, but that is between you and the mortgage lender.  It has nothing to do with the bankruptcy case.  The lien of the 2nd will remain against the property.   You cannot strip liens in a Chapter 7 case.   You might be able to file a CH. 13 now to deal with the 2nd on your home, but many court do not allow that.  You should consult with an attorney in your area.  You may also be able to convert your present case to a Chapter 13 if you do it before the discharge is entered.