The Nevada housing market has been hit the hardest by declining property values. As a result, most homeowners are upside-down, that is, they owe more money on their homes than the fair market value. Despite all the talk about Home Mortgage Modification programs, there has not been wide-scale meaningful relief addressing the declining value. Very rarely does a home mortgage modification reduce the principal balance owed on a home. Most people are lucky to finally have full ownership when they reach their elderly age. Therefore, even after a modification, the homeowner is still left so badly upside-down that the homeowner may never have true ownership in their home.
Chapter 13 Bankruptcy may completely eliminate 2nd and 3rd mortgages. To discharge a 2nd or 3rd home mortgage debt, you must meet certain requirements. In particular, if the fair market value of your home is less than what you owe on the 1st mortgage, you may be able to completely discharge the debt you owe on the 2nd or 3rd home mortgage. For some families, this could be a debt savings in the tens of thousands of dollars or more.