In Georgia, bankruptcy law allows a debtor who has two mortgages to get rid of the second mortgage in a Chapter 13 bankruptcy to stop foreclosure. He or she can then classify the second mortgage as an unsecured debt when the value of the home with the second mortgage is less than the amount of the first mortgage.

For example, assume that a debtor owns a home with a fair market value of $100,000. The debtor has a first mortgage in the amount of $110,000 and a second mortgage in the amount of $25,000. In this situation, he or she can ask the court to get rid of the second mortgage lien on the property as part of the Chapter 13 bankruptcy to stop foreclosure reorganization plan.

What to Expect When the Bankruptcy Court Approves the Request

If the court approves the request, the second mortgage becomes an unsecured debt. That means that the debtor does not have to pay the monthly second mortgage payment during the course of the Chapter 13 bankruptcy to stop foreclosure plan. This legal protection to help reorganize and get caught up on debts typically lasts between three and five years.

Closing the Case After Successful Completion of Chapter 13 Bankruptcy Requirements

After three to five years go by and the person who filed Chapter 13 bankruptcy to stop foreclosure meets all of the court’s requirements, a judge will issue an order discharging all of his or her debts. This includes debt related to the second mortgage.

The bankruptcy court judge will also issue an order that strips the lien from the second mortgage. The debtor should file this lien stripping order with the real estate records office in the same county where the property stands. This document serves to cancel the security deed that the second mortgage company held on the property.

The purpose of obtaining and filing the lien stripping order after closing the Chapter 13 bankruptcy case is to relieve the debtor of the legal obligation to pay money to the company holding the second mortgage. That company will also not have any legal claim to the property or the right to force the mortgage holder into foreclosure.

Georgia lawmakers created the option for bankruptcy to stop foreclosure to allow debtors to essentially eliminate the second mortgage payment. The reason they opted to do this is that the property with the second mortgage does not have any equity built up in it. That means that the company holding the second mortgage does not have a security interest in the property to attach the mortgage.

Don’t Let a Second Mortgage Sink Your Financial Future

People who get in over their heads with real estate debt do not go into the transaction expecting to face a foreclosure someday. The law recognizes that circumstances such as job loss, divorce, or death of a spouse can change a person’s ability to handle the second mortgage and provides a way out through bankruptcy to stop foreclosure.

If you are struggling, we invite you to call the Law Offices of Charles Clapp at 404.585.0040 or e-mail to schedule a free consultation about your second mortgage debt.


Charles is absolutely a brilliant attorney! He is a critical thinker and determined problem solver. He is very accessible, even via text. If he is in court, his ability to multi-task, you can feel safe and secure in knowing he is handling any issues or concerns. I entrust him with my future, he is a uniquely talented attorney who always challenges himself to achieve the absolute best outcome for his clients.



I was very satisfied with Mr. Clapp services. He is a man of his word and did everything he told me he would. I would highly recommend him.



I came to Mr. Clapp by referral with a complicated case involving both personal and business debts that were out of control. Mr. Clapp evaluated the situation and gave me options that I was not even aware of. He knows his stuff, executed flawlessly, and I have been able to start over. I highly recommend Charles Clapp if you have debt or bankruptcy issues. Listen to his advice, he knows his stuff. I consulted with several other bankruptcy attorneys prior to retaining Mr. Clapp, and they did not have the same breadth of knowledge that Mr. Clapp brought to my case.



I selected Charles Clapp to handle my bankruptcy based on his already positive reviews and I am glad that I did! He was very accommodating to my schedule and made my negative life experience positive. I was actually very surprised how easy he made the process. Life happens and it’s great to be represented by someone that understand that!!! Stop your attorney search with Charles Clapp!!!