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§ 506(a)

In re Disney

Ruling
Second mortgage could be avoided pursuant to confirmation to which bank did not object.
Procedural posture

A chapter 13 debtor filed a motion to avoid a bank's second mortgage on real estate pursuant to 11 U.S.C.S. § 506(a). The bank objected to the motion.

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Consumer opinion summary, case decided on February 11, 2013 , LexisNexis #0313-011

In re Brown

Ruling
Debtor could use §506(a) to value trailer that was not a "910 vehicle."
Procedural posture

The chapter 13 debtor filed a modified plan, which provided that surrender of the trailer (RV) was in full satisfaction of the creditor's claim. The creditor objected to confirmation of this plan.

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Consumer opinion summary, case decided on December 03, 2012 , LexisNexis #0113-081

In re Motors Liquidation Co.

Ruling
Fair market standard was correct valuation method for creditor's lien on proceeds of sale of assets.
Procedural posture

In a contested matter the successor to the debtor auto maker agreed to purchase the majority of debtor's assets in a sale under 11 U.S.C.S. § 363. Certain secured creditors, which held liens on two of debtor's assets prior to the sale, asserted that, the value of the creditors liens was not properly determined as a matter of contractual interpretation of the sale order, under the guidance of 11 U.S.C.S. § 506(a).

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Commercial opinion summary, case decided on October 16, 2012 , LexisNexis #1112-085

U.S. Bank Natl Assoc. v. Lewis & Clark Apts. LP (In re Lewis & Clark Apts. LP)

Ruling
Bankruptcy court erred by not attributing value to low income housing tax credits for which debtor was eligible.
Procedural posture

Creditor bank challenged an order of the United States Bankruptcy Court for the Eastern District of Missouri that granted the motion of appellee debtor, the owner of an apartment complex, and valued the creditor's allowed secured claim at $3,500,000, pursuant to 11 U.S.C.S. § 506(a). The issue was whether low-income housing tax credits and use restrictions attributable to the collateral should be considered in valuing the claim.

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Court :
Judge or Jurisdiction information not available
Commercial opinion summary, case decided on October 11, 2012 , LexisNexis #1112-009

Alvarez Valentin v. P.R. Treasury Dept. (In re Alvarez Valentin)

Ruling
Secured tax claim reduced to amount of equity remaining in subject property after first lien in favor of bank.
Procedural posture

Chapter 13 debtors alleged, pursuant to 11 U.S.C.S. § 506(a), that defendant Puerto Rico Treasury Department (creditor) only had a secured claim against debtors in the amount of $11,442 as opposed to a larger amount claimed by the creditor. The debtors filed a motion for summary judgment.

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Consumer opinion summary, case decided on July 10, 2012 , LexisNexis #0812-014

Bernal v. Shinall (In re Bernal)

Ruling
Second lienholder's claim was unsecured where value of property was less than amount owed to first lienholder.
Procedural posture

The court held a trial on the Complaint to determine the value of the interest of defendant, a second lienholder, in the residential real estate of plaintiff debtors, and to determine whether the allowed claim of the second lienholder was secured.

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Consumer opinion summary, case decided on June 04, 2012 , LexisNexis #0612-113

Arnold v. Beneficial Neb. Inc.

Ruling
Debtor could strip off wholly unsecured third lien.
Procedural posture

Debtors filed an adversary proceeding against defendant creditor to avoid a junior lien on debtors' real property. Debtors filed a Fed. R. Civ. P. 56(c) motion for summary judgment.

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Consumer opinion summary, case decided on May 08, 2012 , LexisNexis #0512-122

In re Perales

Ruling
Bankruptcy court properly granted debtor's motion to redeem vehicle as creditor had adequate notice of hearings.
Procedural posture

Appellant creditor challenged a decision of the bankruptcy court for the Northern District of Ohio, which granted debtor's motion pursuant to 11 U.S.C.S. § 722 to redeem his vehicle for a lump sum of $1,400.

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Court :
Judge or Jurisdiction information not available
Consumer opinion summary, case decided on March 12, 2012 , LexisNexis #0412-009

Frazer v. Property Owner Assoc. of Canyon Vill. At Cypress Springs (In re Frazer)

Ruling
Homeowners' association lien could be avoided where outstanding balance on prior purchase money lien exceeded value of subject property.
Procedural posture

Debtors' sought a declaratory judgment that a lien held by the homeowners' association on their homestead was subordinate to a purchase money lien held by their home lender, that there was no equity in their residence, and that their chapter 13 plan could "strip" the association's lien on their homestead under 11 U.S.C.S. §§ 506(a) and 1322(b)(2).

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Consumer opinion summary, case decided on March 05, 2012 , LexisNexis #0312-117

In re Scantling

Ruling
Eligibility for discharge is not a prerequisite to stripping off wholly unsecured junior lien.
Procedural posture

Chapter 13 debtor, who was ineligible for a discharge because she had previously received a discharge of her debts in a chapter 7 case filed within four years of her chapter 13 filing, sought to strip off a wholly unsecured junior mortgages encumbering her principal residence. The creditor second mortgagee objected.

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Consumer opinion summary, case decided on February 24, 2012 , LexisNexis #0312-118