What is a lien?
A lien is any document that affects the title to your home.
It may be a mortgage, a home equity line of credit, a court judgment,
or even a notice that you owe back taxes or Association dues. You
cannot sell a piece of real estate without paying off or otherwise
resolving all liens on a property. Nevada Homestead laws
only protect your property from being forcibly sold as a result
of a judgment lien. A Homestead does not stop a lien from
earning interest every month and growing larger and larger each
What can be done if the liens are larger than the value of a
What is lienstripping?
Some people are still able to afford to pay $300,000
for a house that is only worth $150,000. And of these people
who are able to afford to do so, some will stay, some will
try to "short sale" their property, while others may let
the property go into foreclosure. Those who could afford
to stay, but chose to let the property go into foreclosure
are described as engaging in a "strategic foreclosure."
Many more people have found that they cannot afford to
stay in their homes for a variety of financial reasons.
Some have lots their jobs or had their wages or hours cut.
Others have suffered unexpected personal problems. Many
people have looked to loan modification to try to make
their mortgage payments more affordable. For those that
qualify, lienstripping can allow a person to completely
remove a judgment lien as well as a home equity line of
credit or other "subordinate mortgage lien."
Lienstripping is a program within Chapter 13 Bankruptcy that
allows the lien to be completely removed from the title to real
estate. It doesn’t matter if the real estate is a home,
an office building, an apartment complex, or bare land.
Lienstripping requires that the property be appraised for an
amount that is less than the balance on the first mortgage. Lienstripping
also requires that the person file and complete a debt settlement
program in Chapter 13, which is a court supervised debt settlement
program, requiring monthly payments for up to 5 years.
If I am underwater on my first mortgage, what else would I need
to qualify to lienstrip?
You have to show that you have a steady income sufficient to
afford to pay the monthly ongoing mortgage payment, pay your
other expenses, and have at least $100 left over to put towards
paying a portion of your debts. If you have certain types of
debts that Bankruptcy law requires to be paid in full, such as
past income taxes, child support, or past due payments on your
first mortgage, your monthly payments will have to be large enough
to take care of these debts. A Chapter 13 will require you to
pay all money left over after paying your essential living expenses
to a Bankruptcy Trustee, who will then portion out your payments
to pay some of your debts.
Is lienstripping legitimate?
Lienstripping can only take place under the authority of a United
States federal bankruptcy judge. The federal court system is
not going to approve lienstripping unless it is completely satisfied
that lienstripping is allowed by law. Millions of dollars of
liens have been removed by the Bankruptcy Judges in Nevada every
week for the past few years.
Is there any other way to remove liens?
Judgment liens can be removed in Chapter 7, which is regular
bankruptcy, as well as in Chapter 13. In many situations, a bankruptcy
attorney such as Dorothy Bunce with A Fresh Start can persuade
a mortgage lienholder to accept "pennies on the dollar" to remove
a 2nd or 3rd deed of trust or home equity loan, especially if
the property owner has eliminated the debt through bankruptcy.
But results outside of Chapter 13 bankruptcy cannot be guaranteed.
Bankruptcy allowed GM and Chrysler to return to profitability.
Bankruptcy allowed Station Casinos to remodel and still stay
Why should the rest of us feel that Bankruptcy is a stigma?
Go to our video page to watch attorney Dorothy Bunce explain
the Nevada foreclosure laws in more detail. If you live in southern
Nevada, and want to learn more about whether you can qualify
to save tens of thousands of dollars by lienstripping, call 702-456-1920,
extension 205 during business hours.
And we may be able to help you resolve other financial problems
as well. Are you facing a pending foreclosure? Call us for immediate
help. Overwhelmed by debt that's threatening ownership of your
home? Watch our 2 part video about Nevada foreclosure or our
4 part video about mortgage modification on our video page.
may be able to help you resolve other financial problems
as well. Are you facing a pending foreclosure? Call us
for immediate help. Overwhelmed by debt that's threatening
ownership of your home?
You deserve a fresh start!
At A Fresh Start, we use the law to help you get a fresh
Call 800-903-5715 anytime to hear recorded
information about foreclosure.
Go to our video page to watch
attorney Dorothy Bunce
Learn all about Nevada foreclosure or mortgage modification
See her explain the Nevada foreclosure laws in more detail.
We urge you to read our many client reviews
posted on the internet.