Can Bankruptcy Remove a Second Mortgage in Texas?

Can Bankruptcy Help You Get Rid of a Second Mortgage in Texas?

If you’re buried under debt and juggling multiple mortgages, you might be asking, “Can bankruptcy remove a second mortgage in Texas?” The short answer: yes, under specific conditions, especially in Chapter 13 bankruptcy. Let’s break down what that means, how it works, and whether it’s a fit for your financial situation.

What Is a Second Mortgage and Why Is It Hard to Shake?

A second mortgage is a loan taken out using the equity in your home as collateral—often in the form of a home equity loan or HELOC (Home Equity Line of Credit). It sits behind your primary mortgage and becomes due even if you’re struggling financially.

Unlike unsecured debt like credit cards, second mortgages are secured by your property. That means lenders can foreclose if you default—unless, of course, you qualify for lien stripping in bankruptcy.

How Does Lien Stripping Work in Texas?

Lien stripping is a legal tool available in Chapter 13 bankruptcy that allows you to remove junior liens—like a second mortgage—if certain conditions are met.

Here’s When You Can Strip a Second Mortgage:

• Your home’s value is less than your first mortgage balance.

• Your second mortgage is completely unsecured due to the property’s depreciation.

• You file for Chapter 13 bankruptcy, not Chapter 7.

In short, if your house isn’t worth more than your first mortgage, the second mortgage is no longer “secured” under bankruptcy law and may be reclassified as unsecured debt—which can be reduced or wiped out entirely during your repayment plan.

Learn how Chapter 13 bankruptcy protects homeowners in Texas.

Why Doesn’t Chapter 7 Bankruptcy Work the Same Way?

Great question. Under Chapter 7, you can discharge unsecured debts, but you can’t use lien stripping to eliminate a second mortgage, even if your home is underwater. Chapter 7 also doesn’t give you the structured repayment protection that Chapter 13 provides.

So if your goal is to remove a second mortgage through bankruptcy in Texas, Chapter 13 is your path.

Protecting Home Equity in Texas: What’s the Law Say?

Texas offers some of the most generous homestead exemptions in the U.S., which means:

• You can keep your primary residence even during bankruptcy.

• You can exempt an unlimited amount of home equity, as long as the property doesn’t exceed 10 acres (urban) or 100–200 acres (rural).

That’s good news if you’re worried about losing your home while trying to eliminate debt.

Is Lien Stripping Right for You?

Consider lien stripping if you:

• Owe more on your first mortgage than your home is worth.

• Are struggling to keep up with mortgage or HELOC payments.

• Want to avoid foreclosure and stay in your home.

• Can commit to a 3-5 year Chapter 13 repayment plan.

However, you’ll need a bankruptcy attorney to help file a motion to strip the lien and prove that your second mortgage is unsecured.

FAQs About Second Mortgage Bankruptcy in Texas

Can I file Chapter 13 just to remove my second mortgage?

Yes, but you must also follow the full repayment plan and meet income requirements.

Do I still have to pay part of the second mortgage if it’s stripped?

Maybe. Once reclassified as unsecured, your second mortgage becomes part of your general unsecured debt—which may only be partially repaid (or not at all) under the Chapter 13 plan.

Can I refinance or sell my home after lien stripping?

Yes—but the lien must be officially removed through a court order during bankruptcy. Otherwise, it still clouds the title.

Why Choose Kisch Consumer Law for Second Mortgage Bankruptcy?

Bankruptcy isn’t just paperwork—it’s a strategic move. At Kisch Consumer Law, we help Texans protect their homes and eliminate burdensome debt through Chapter 13 filings that use lien stripping to your advantage.

Here’s what sets them apart:

• In-depth experience with Texas homestead laws and lien stripping.

• Personalized, no-judgment consultations.

• Transparent, flat-fee pricing and payment plans.

• A team that explains every step—clearly and compassionately.

What’s the Best Way to Get Started?

Simple: Know your numbers. Get your home appraised and find out:

• The current market value.

• The balance on your first mortgage.

• The balance on your second mortgage or HELOC.

Then, contact a bankruptcy attorney who understands lien stripping and second mortgage removal strategies in Texas.

Ready to Get Out From Under Your Second Mortgage?

If your house is worth less than what you owe and your second mortgage is a financial anchor, it’s time to act. Bankruptcy might not be your first choice—but it could be your smartest one.

Strip that lien. Save your home. Reclaim your future.

Visit Kisch Consumer Law and learn how to create a data-driven strategy to protect your home equity while clearing debt through Chapter 13.

A Little Comic Relief Before You Go…

You’ve just powered through 2,000 words about second mortgages and bankruptcy—that’s more endurance than most of us show on Tax Day.

But if your wallet’s doing yoga to stretch those mortgage payments, maybe it’s time to bring in the professionals. Call it lien stripping or call it financial feng shui—just know that there’s a legal way to lighten the load.