Bank of america charged off my HELOC Accoun of 173,000, but still has lein on property for the debt as security.

The short answer is that, yes, you can in some cases strip liens from real estate. The long answer is that this is a complicated process that will take you between 3-5 years using bankruptcy. In order to remove the lien from the home, you would need to file and complete a Chapter 13 case AND you would have to owe more on the 1st mortgage alone than the home is currently worth. For example, if the home was worth $350,000, and you owed $400,000 on JUST the 1st mortgage, then a Chapter 13 could strip the lien. Chapter 13 would require you to repay some portion of the debt you owe (mortgage, credit cards, taxes, medical bills, etc.) over the next 3-5 years. In order to strip the lien, you would have to complete that full 3-5 year repayment plan with the court. This process is complex, and you should consult with an experienced bankruptcy attorney in your area.

Will you be able to accomplish this In a Chapter 7 bankruptcy? No*. A chapter 7 bankruptcy does not allow a debtor to avoid a consensual lien; however, a judgment lien may be avoided under certain conditions in a chapter 7 case. Will you be able to accomplish this in a Chapter 13 bankruptcy? Possibly Yes (previous answer describing Chapter 13 analysis and process is accurate). * Note: as a matter of the California settlement with the "big 5" banks/servicers/lenders, in certain scenarios certain BofA has begun voluntarily releasing borrowers from further liability on 2nd mortgage liens, HELOCS, or junior liens. This is not happening by way of bankruptcy law, but instead is being offered by B of A per its own policy/program, and very likely to comply with the terms of the settlement brokered with the California Attorney General. Best of luck! Michael Salanick [email protected] www.salanicklaw.com

The cheapest route is to settle with them in exchange for release of the lien. I have done this for a number of clients.

A charge off simply means that the note is non-performing and the lender intends to write off the loan, at least in part, as a loss. The lien remains, however, and unless the lender releases it by way of a reconveyance of the deed of trust. As noted by other attorneys, you can strip HELOCs and other junior liens from your primary residence if the lien is wholly unsecured, meaning that the balance on the first lien exceeds the property value such that the junior lien has no equity to support it. Also, as noted by other attorneys, B of A has new loan modification programs which involve the cancellation, in whole or in part, of mortgage debt. Consult a tax professional about the tax consequences of cancelled debt.