As a Chicago bankruptcy lawyer, I have a lot of clients whose mortgages are significantly underwater due to the real estate crisis. A Chapter 13 reorganization bankruptcy allows a debtor to strip or eliminate a 2nd mortgage as long as there is not a dollar in equity to support the lien under 11 U.S.C. 506. In practical terms, as long as the debtor does not have any equity to provide $1 in support for the second mortgage the lien can be paid back as an unsecured claim like a credit card, medical bills, or any other unsecured debt over the life of a Chapter 13 plan. It is important to note that the debtor cannot strip a lien in a Chapter 7 bankruptcy and if there is equity to support the second mortgage it cannot be stripped off. Also, a first mortgage is unable to be modified in a Chapter 13. If you have questions please contact an experienced Chicago bankruptcy attorney at 312-489-8182 today to set up a free consultation.