Certain property may be reduced by stripping off the negative equity thereby reducing the loan to its fair market value. If you have a lease on a vehicle and have owned it more than 910 days, it may be possible to strip off the loan to its fair market value. This is sometimes called a cram down. It can also be used to strip -off the second mortgage from a primary residence that is homesteaded if the value of the house is less than its 1st mortgage. For example, if you have a home that has a 1st mortgage of 200,000.00 dollars, a second mortgage of 100,000.00 dollars and its value has decreased to at or below 200,000.00, then the ENTIRE second mortgage can be crammed down, or lien stripped – totally eliminating that debt! Better still, if you own investment property, then you can cram down the 2nd AND 1st mortgage to the properties fair market value.  You can only strip off liens in a Chapter 13 bankruptcy.

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